Here Are the 5 Strategies Outlined in HKMA’s Fintech 2025 Plan

Here Are the 5 Strategies Outlined in HKMA’s Fintech 2025 Plan

by June 9, 2021

The Hong Kong Monetary Authority (HKMA) has unveiled “Fintech 2025”, its new strategy for driving fintech development in Hong Kong which includes further testing of Central Bank Digital Currencies (CBDCs).

According to a statement by HKMA, the new fintech strategy aims to encourage the financial sector to adopt technology comprehensively by 2025.

The five focus areas put forward by the strategy are:

Future-proofing Hong Kong for CBDCs

As part of this plan, HKMA will strengthen its research work to increase Hong Kong’s readiness in issuing CBDCs at both wholesale and retail levels.

In addition to the continued effort on wholesale CBDCs, the HKMA has been working with the Bank for International Settlements (BIS) Innovation Hub Hong Kong Centre to research retail CBDCs and will begin a study on e-HKD to understand its use cases, benefits, and related risks.

The HKMA will also continue to collaborate with the People’s Bank of China in supporting the technical testing of e-CNY in Hong Kong with a view to providing a convenient means of cross-boundary payments for both domestic and mainland residents.

HKMA and the Bank of Thailand had previously jointly announced that the central banks of China and the United Arab Emirates will be joining them for the second phase of their digital currency project which has been renamed as “m-CBDC Bridge”.

Banks to fully embrace fintech

Additionally, HKMA will continue to promote the all-round adoption of fintech by Hong Kong banks and encourage them to fully digitalise their operations, from front-end to back-end building on the Smart Banking Era Strategy announced in 2017.

To take this forward, the HKMA will roll-out a Tech Baseline Assessment to take stock of banks’ current and planned adoption of fintech in the coming years, to identify fintech business areas or specific technology types which may be underdeveloped, and would benefit from HKMA support.

The HKMA will issue further supervisory guidance to facilitate the uptake of novel technologies and continue to “walk the talk” by digitalising its supervision of banks through the use of advanced technologies.

Creating the next-generation data infrastructure

The strategy also revealed that HKMA will take the lead in enhancing the city’s existing data infrastructure and building new ones, including Commercial Data Interchange, digital corporate identity, and DLT-based credit data sharing platform, to facilitate consent-based data sharing.

Expanding the fintech-savvy workforce

To increase the supply of fintech talent, the HKMA aims to collaborate with various strategic partners to groom all-round fintech talent, both students and practitioners, through various initiatives, including developing fintech-specific training programmes and qualifications, as well as promoting joint projects between the industry and the academia.

An example of such initiatives is the Industry Project Masters Network (IPMN) scheme.

It will be piloted this September to provide internship opportunities to postgraduate students to work on banks’ fintech projects on federated learning and other artificial intelligence technologies.

A new fintech cross-agency group and funding policies

A new Fintech Cross-Agency Co-ordination Group will be established by the HKMA and various industry key players to formulate supportive policies for the Hong Kong fintech ecosystem.

Moreover, HKMA will continue the preparatory work for the Hong Kong Growth Portfolio, which seeks to reinforce Hong Kong’s status as a financial, commercial and innovation center.

It will also enhance its Fintech Supervisory Sandbox and is exploring with the Innovation and Technology Commission the possibility of providing funding support to qualified fintech projects.

Eddie Yue

Eddie Yue

Eddie Yue, Chief Executive of the HKMA said,

“Fintech is, without doubt, a key growth engine for the financial industry in the post-pandemic era, and now is the right time to double down on our efforts to grasp the opportunities.


“Fintech 2025” sets out our vision in this regard. I urge all stakeholders to join forces with the HKMA. Together, we can take our city’s fintech ecosystem to new heights.”

Further details of the initiatives under the “Fintech 2025” strategy will be announced by the HKMA in due course.