ANALYSIS: FINANCIAL TECHNOLOGY
HKMA has been spearheading the efforts to lead the fintech industry in Hong Kong
Hong Kong’s fintech scene attracts new talent, investment cash
Unique drivers include favorable regulations, a specialised talent pool, and accessibility to Mainland China.
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n less than a decade, Hong Kong has established itself as a hub for fintech startups and as a gateway for international companies to enter Asia. The top hubs for fintech were centralised in London and New York before industry leaders ventured into entering Singapore and Hong Kong. The Hong Kong Monetary Authority (HKMA) has been spearheading the efforts to lead this new industry in Hong Kong in the recent years. It opened the Fintech Facilitation Office (FFO) in 2016 to facilitate the healthy development of the fintech ecosystem and to promote Hong Kong as one of the top fintech hubs in Asia. Among their projects that were launched include the Open Application Programming Interface (API) for the banking sector where they introduced the exchange of information and instruction through computer programming, 18
HONG KONG BUSINESS | APRIL 2021
the Fintech Supervisory Sandbox (FSS) which facilitated partnerships between technology firms and banks, and the Fintech Career Accelerator Scheme (FCAS) to elevate the available fintech talent pool in Hong Kong. In the Keynote Speech of HKMA Chief Executive Eddie Yue at the Asian Academy of International Law Conference on 26 February 2021, he shared that Hong Kong remained resilient and stable even during the COVID-19 pandemic. The Hong Kong dollar remained strong against the US dollar, and deposits at Hong Kong banks grew by 8.5% in the past two years. HKMA recorded a total inflow of US$50b since April 2020. At the same time, Hong Kong remains as a top pick for being a gateway to Mainland China. Volumes in their Bond Connect link increased by 82% in 2020, and more than 2,400 institutional inves-
Hong Kong has established itself as a hub for fintech startups and as a gateway for international companies to enter Asia
tors registered on the platform. Its average daily turnover in its Stock Connect links with Shanghai and Shenzhen was also said to have doubled in the past year. A Hong Kong Institute for Monetary and Financial Research (HKIMR) report shows that the banking sector is welcoming the technology revolution, with most banks now adopting fintech programmes to complement their current services. Whilst most banks see fintech as an opportunity rather than a threat, they find it necessary to digitise and modernise themselves over the next 10 years. This is in order to maintain customer relationships and core banking services as new competitors enter the industry. Stable and strong regulations Hong Kong Business spoke with fintech companies YAS Digital Limited (YAS), Incomlend, and AQUMON
