Hong Kong is known as an international FinTech hub, as it has been one of the most productive markets for the growth of FinTech startups. Despite being a relatively small city compared to other FinTech hubs, it is one of the top cities for scaling up startups.
Hong Kong FinTech development
Hong Kong FinTech market has ranked at the top for various FinTech rankings. There is more than one reason for such a strong positioning and continuous growth opportunities within the global FinTech community.
- Hong Kong serves as a platform for China — the world’s top consumer market for FinTech.
- Hong Kong has been a popular choice for FinTech companies to have their IPO due to attractive listing rules for tech companies.
- Hong Kong is one of the freest markets with sandboxes and initiatives to prosper FinTech development and increase cross-border operations.
- Hong Kong has a low and simple tax structure for startups and other ways of government support for the new businesses.
This market sees the potential, and there are many other facts and reasons for the industry’s attractiveness. Moreover, the Hong Kong Monetary Authority (HKMA) will be launching a strategic plan called FinTech 2025 to drive the industry’s growth.
Hong Kong’s CBDC
The HKMA has been working closely with the Bank of International Settlements (BIS) to research retail CBDC. This year, as a part of the FinTech 2025 strategy, it will study the benefits and risks of the retail digital Hong Kong dollar known as e-HKD.
Hong Kong also continues to collaborate with the People’s Bank of China and supports the technical part of testing the e-CNY. The project aims to research cross-boundary payments for both domestic and mainland residents.
Who regulates the industry?
FinTechs in Hong Kong is subject to the existing body of financial laws and regulations. FinTech companies are licensed by the Securities & Futures Commission (SFC). The regulated activities fall into multiple regulatory regimes that are explained on the ICLG website.
In September 2016, the HKMA launched the FinTech Supervisory Sandbox that “allows banks and their partnering technology firms (tech firms) to conduct pilot trials of their fintech initiatives.” For more on the sandbox, you can visit HKMA’s website.
