In the previous 12 months, the COVID-19 epidemic has troubled Hong Kong and the world, but it has also brought unparalleled business enterprise opportunities to the economical technology (FinTech).
For case in point, the More rapidly Payment System (FPS) has recorded an amazing growth in 2020. In past October, an common of 452,000 authentic-time transactions had been processed each and every day, which was twice that of the stop of the prior yr, involving HK$4.4 billion and RMB44 million. Statista, a enterprise details web-site, estimates that in 2020, virtually 70% of Hong Kong men and women have utilised on-line buying.
Hong Kong’s monetary engineering business has flourished significantly, however, if it can increase to the Larger Bay Space (GBA), it will have an even much more promising upcoming.
In accordance to the June 2020 report produced by the Money Expert services Development Council, there is escalating integration inside of GBA, as inhabitants frequently travel within just the location for schooling, work, tourism, checking out kin, enterprise and far more. Having said that, the existing supporting services are not very good enough for the modifying cases, so there are great small business chances.
We can see the chances of supplying GBA citizens with “serious-time, secure, reduced-expense and economical” banking transfer, coverage goods and companies masking the full GBA, as properly as comfort for Hong Kong people to open up mainland bank accounts and use mainland qualities as safety for cross-border home finance loan financial loans, and extra. The report also rates the Hurun Prosperity Report 2019, stating that there are a total of a single million “wealthy families” with property of RMB6 million and “high-net-truly worth families” with property of RMB10 million in Guangdong Province. Even underneath the effects of the epidemic in 2020, the selection of these households did not drop also much, and continues to be the second major in the nation. They are mainly found in Shenzhen, Guangzhou and Foshan. These rich people have good demand for wealth management.
However, Hong Kong is still to realise company alternatives for the time staying, mainly owing to the distinction in program, regulation, and society amongst Hong Kong and the mainland. This is also a frequent problem internationally. That is the cause why a supervisory sandbox has been proposed to enable fiscal regulators to discover the likelihood of cross-border finance underneath managed problems. For instance, in 2018, the Monetary Conduct Authority (FCA) in the United Kingdom initiated a international sandbox to enable impressive monetary goods to be analyzed internationally.
However, carrying out transnational companies is comprehensive of problems. Our FPS is an example, inspite of its performance, it is still limited to regional use. Cross-border payments stay characterized by small effectiveness, large price, and absence of transparency, making it hard for us to “make serious-time, cross-border payments in the blink of an eye no matter of wherever we are”, as mentioned in a weblog of Eddie Yue, main executive of the Hong Kong Financial Authority (HKMA).
Hence, I am happy that the HKMA has built much development on cross-border payments lately. In addition to a joint investigate task with the Financial institution of Thailand on how to use the central bank’s digital currencies and blockchain platform to address many concerns in cross-border payments, it is also fully commited to prolong FPS as payment applications in well-liked vacationer hotspots for Hong Kong folks. It also functions with the Digital Currency Institute of the People’s Lender of China to examine the use of e-CNY, the digital renminbi for cross-border payments, presenting another selection for long run retail client payments in the mainland and Hong Kong.
As an intercontinental money centre, Hong Kong has produced some development in FinTech in the latest decades. To enhance our position as Asia’s FinTech centre, collaboration among the authorities, private and public corporations and the normal general public is indispensible. It is also the crucial to be successful as a clever metropolis.
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