On 29 September 2017, the Hong Kong Monetary Authority (HKMA) announced a range of initiatives aimed at preparing Hong Kong for a new era of smarter banking driven by technological advances.
The HKMA press releases were announced on the same day as, and supplement, announcements by the Securities and Futures Commission (SFC) and the Insurance Authority (IA) concerning Hong Kong fintech initiatives.
The key initiatives announced by the HKMA include (amongst others):
- Faster Payment System (FPS): Hong Kong licensed banks (Banks) and licensed stored value facility operators can participate in the FPS, which supports the use of mobile phone numbers and email addresses for payments in Hong Kong dollars and Renminbi anywhere and anytime. The HKMA expects to launch the FPS in September 2018.
- Enhanced Fintech Supervisory Sandbox (FSS) 2.0: the HKMA expects to launch the FSS 2.0 by the end of 2017. The FSS 2.0 will have three new features:
- Fintech Supervisory Chatroom (Chatroom) to provide rapid feedback to Banks and technology firms at an early stage of their Fintech projects;
- Direct access to FSS 2.0 via the Chatroom for technology firms, without having to go through a Bank; and
- Linking up of the sandboxes of the HKMA, SFC and the IA, so that cross-sector fintech products will have a single point of entry.
- Promotion of Virtual Banking: the HKMA will launch a consultation to review and update the Guide to Authorization of Virtual Banks (issued in 2000). The HKMA also announced that it welcomes the introduction of virtual banks in Hong Kong.
- Banking Made Easy initiative: the HKMA will establish a new HKMA task force to work alongside the banking industry to minimise regulatory frictions in customers’ digital experience, including in areas such as remote onboarding, online finance and online wealth management.
For further details on the fintech initiatives announced by the IA and the SFC, please refer to our IA blog post and our SFC blog post.
Further details of the initiatives will be announced by the HKMA in due course.