The Hong Kong Monetary Authority (HKMA) announced the results of the Tech Baseline Assessment and its plans for further supporting the industry’s adoption of fintech.

As part of its “Fintech 2025” strategy, the HKMA is promoting the all-round adoption of fintech by banks and encouraging them to fully digitalise their operations, from front-end to back-end.

The Tech Baseline Assessment, rolled-out in June 2021 as part of the “All banks go Fintech” initiative, took stock of Hong Kong banks’ current and planned adoption of fintech in the coming three years.

The regulator also assessed whether there may be fintech business areas and technology types that would benefit from its support.

Overall, HKMA said that the results of the assessment indicate that the banking industry is supportive of its fintech drive.

Some key observations from the assessment were that banks are prepared to dedicate healthy amounts of financial and talent investment to fintech adoption, and most expect to make good progress by 2025.

Adoption of the surveyed Fintech business areas is expected to increase across the board.

Banks also intend to utilise extensively both established (e.g. cloud, API and low code automation) and more novel technology types (e.g. artificial intelligence and distributed ledger technology) as they press ahead with their fintech strategies.

HKMA will formulate over the next few months a detailed roadmap of initiatives to further promote developments in the fintech business areas of investech, wealthtech, insurtech and greentech, as well as the technology types of artificial intelligence and distributed ledger technology.

During the process, the HKMA will closely engage with other local authorities, including the Securities and Futures Commission, the Insurance Authority and the Mandatory Provident Fund Schemes Authority to identify opportunities for cross-sectoral collaboration.

Arthur Yuen, Deputy Chief Executive of the HKMA said,

“Technology is re-shaping consumers’ expectations for banking services. We are pleased to see that banks in Hong Kong are actively positioning themselves to respond to this evolving demand and gearing up to remain competitive under this “new normal”.

 

The HKMA’s work under the “All banks go Fintech” initiative is an important element of the “Fintech 2025” Strategy and will support the Hong Kong banking sector to unlock the full potential of Fintech.”