“All Banks Go Fintech”: Hong Kong presents “Fintech 2025” technique
The Hong Kong Monetary Authority (HKMA) plans to lead local banks to fully adopt fintech technologies, a new strategy shows. The region’s central banking institution also stressed that digitizing its own oversight of financial institutions will make it “walk the talk”.
Hong Kong central bank supports fintech development
Hong Kong’s monetary regulator has unveiled its new strategy to promote fintech development in China’s Special Administrative Region. With the strategy, HKMA is aiming for a comprehensive introduction of new financial technologies over the next four years. The central bank also wants to “promote the provision of fair and efficient financial services for the benefit of Hong Kong’s citizens and the economy.”
Speaking at a seminar organized by the Hong Kong Association of Banks, Eddie Yue, CEO of HKMA, outlined five focus areas of Fintech 2025. The regulator wants to encourage all banks to run fintech, future-proof Hong Kong for CBDCs, create a next-generation data infrastructure, expand the fintech-experienced workforce, and maintain the ecosystem with funding and guidelines.
One of the main directions in which the monetary authority intends to intensify its efforts is the complete digitization of banking operations. HKMA is building on the success of its Smart Banking Era strategy announced in 2017 and will continue to “promote the widespread adoption of fintech by banks in Hong Kong”. The regulator will identify certain fintech areas where the sector is lagging behind and needs support. This also applies to the company’s own regulatory framework:
HKMA will continue to issue regulatory guidance to facilitate the adoption of novel technologies and will continue to “speak out” by digitizing its banking supervision through the use of advanced technology.
HKMA is working with stakeholders to implement the “Fintech 2025” strategy
The new strategy envisages improving and expanding the city’s existing data infrastructure. The Hong Kong Monetary Authority plans to set up a platform for the exchange of credit data based on distributed ledger technologies (DLT) and to set up a commercial data interchange.
The central bank will work to increase the availability of fintech talent through new training programs and collaboration between industry and academia. One such initiative is the Industry Project Masters Network, a program that offers postgraduate internships for fintech projects at participating banks. The program starts in September.
The HKMA said it will involve industry players in setting up a new multi-agency fintech coordination group tasked with formulating supportive guidelines for the fintech ecosystem. The monetary authority will improve its fintech supervisory sandbox and, in cooperation with the region’s innovation and technology commission, provide funds for qualified fintech projects. HKMA CEO Eddie Yue emphasized:
Fintech is without a doubt a major growth engine for the financial industry in the post-pandemic era, and now is the right time to step up our efforts to seize the opportunity. “Fintech 2025” describes our vision in this regard. I urge everyone involved to join forces with the HKMA.
The Financial Regulator intends to do some of its efforts to increase Hong Kong’s readiness to issue central bank digital currencies. HKMA relates not only to developing CBDCs for wholesale, but also to researching digital currencies for retail. The financial institution will continue to assist People’s Bank of China in testing the digital yuan (e-CNY) for cross-border payments, while also launching a separate study on a digital Hong Kong dollar (e-HKD).
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Banking Institution, Banks, Central Bank, China, Data Infrastructure, Digital Hong Kong Dollar, Digital Yuan, DLT, e-CNY, e-HKD, Financial Institutions, Fintech, Fintech 2025, HKMA, Hong Kong, Monetary Authority, Strategy &, Technologies
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