Hong Kong, an international finance hub, has set out to become a leader in fintech with the Hong Kong government and regulators actively supporting the growth of the industry.
Today, the city hosts over 130 fintech startups, offers three fintech sandboxes for firms and startups to test innovative financial products, and counts four fintech-focused accelerators.
A lot has happened since the beginning of year as Hong Kong maintains its fintech momentum. Here’s a roundup of the key fintech developments and announcements of the first half of 2018:
Hong Kong budget to boost fintech
Hong Kong Financial Secretary Paul Chan attends joint television panel discussion program “Budget Forum,” via GovHK
In his annual budget speech in February, Hong Kong’s financial secretary Paul Chan said that the government will be allocating as much as HK$500 million over the next five years to support its financial services industry including the development of fintech.
The money will go toward a long-term tech and innovation push.
“Hong Kong must optimize its resources by focusing on developing its areas of strength, namely biotechnology, artificial intelligence, smart city and fintech, and forge ahead according to the eight major directions set out by the chief executive,” Chan said.
Fintech Association of Hong Kong celebrates first anniversary
Set up in June 2017, non-profit organization the Fintech Association of Hong Kong recently celebrated its first anniversary.
The organization says it achieved several milestones in the past year including entering into partnerships with many local organizations including Cyberport and Hong Kong Science Park. On the advocacy level, it provided comments on behalf of its members to key regulatory consultations, including to these on virtual banking and open APIs.
The Financial Association of Hong Kong, which aims to be “the voice of the fintech community in Hong Kong,” now represents over 1,000 members and 160 organizations.
Fintech agreements and alliances
Several partnerships and agreements were signed in the first half of 2018. A notable one is the partnership between the Abu Dhabi Global Market, the International Financial Centre in Abu Dhabi, and the Hong Kong Monetary Authority (HKMA). The cooperation agreement, unveiled last month, focuses on jointly developing a cross-border trade finance system built on distributed ledger technology.
The HKMA also signed a Memorandum of Understanding (MoU) with the Polish Financial Supervision Authority (KNF) in March to collaborate on fintech research projects, information exchange, mutual consultations and expertise sharing.
An alliance was unveiled in January that counts among its core members Cyberport, the Smart City Consortium (SCC) and IBM China/Hong Kong Ltd. The CSI Alliance aims to foster collaboration between tech, academic and commercial stakeholders to address issues faced by fintech startups and help accelerate growth. Cyberport is a startup hub with 1,000 digital tech companies.
Another partnership was formed between the Fintech Association of Hong Kong and Fintech Australia in February to strengthen the ties between each organization’s fintech ecosystem. The two organizations will work together to support businesses seeking investment, partnerships or entry into each other’s markets, encourage greater regulatory harmonization by exchanging information on policy developments, and collaborate on initiatives such as research, among other things.
Foreign fintechs enter Hong Kong
Following a three-month pilot in Hong Kong, the UK’s cross-border money transfer platform TransferWise fully launched in the city earlier this month. TransferWise now offers services for both businesses and individuals.
Swiss fintech startup Investment Navigator launched a new investment platform in Hong Kong in June. Investment Navigator, a four-year-old Zurich-based startup, launched the platform after participating in the Super Charger fintech accelerator program in Hong Kong.
The Investment Navigator platform supports professional investors in their search for fund for their clients. It has earned the startup its first premium partner in HSBC’s global asset management unit.
New fintech, innovation labs
Finastra Digital
Fintech firm Finastra launched an innovation lab called the Future of Banking Centre of Excellence in April. Located in startup hub Cyberport, the lab aims to facilitate collaboration between banks and other fintech companies using Finastra’s platforms.
Formed in 2017 by the combination of D+H and Misys, London-headquartered Finastra builds and deploys technology on an open software architecture, serving financial institutions.
Standard Chartered launched its latest innovation lab in the bank’s building in Kwun Tong in April.
“For us at Standard Chartered Hong Kong, the eXellerator is more than just a new office space. It is all about innovation and making change happen,” said Mary Huen, CEO of Standard Chartered Hong Kong. “As clients become more digital and expect more seamless, timely and user-friendly access to banking services, we need to constantly innovate and improve, or risk being left behind.”
Standard Chartered launched its first eXellerator in Singapore in 2016. In other news, Standard Chartered has been developing a virtual bank and intends to apply for a license in Hong Kong.
Featured image: Hong Kong, Pixabay.
