Hong Kong embracing virtual banks


Hong Kong, a global leader in banking and finance, is bracing for the arrival of so-called virtual banks — financial institutions without physical branches where all transactions are online – reports CNBC.

Authorities are keen to raise Hong Kong’s game in financial technology, part of broader ambitions to turn the semi-autonomous Chinese territory into a “smart city” amid intensifying regional and global digital competition.

Financial regulator Hong Kong Monetary Authority (HKMA) released revised guidelines for virtual banks at the end of May after consultations with stakeholders, including the Hong Kong Association of Banks.

The HKMA said more than 50 companies have expressed interest in the licenses. Firms face an August deadline for the first batch, which could be issued as early as this year. Locally based payments platform Yedpay and international bank Standard Chartered said they plan to apply for licenses, while online lending operator WeLab is reportedly among those hoping to obtain one.

“The development of virtual banks will promote the application of financial technology and innovation in Hong Kong and offer a new kind of customer experience,” the HKMA said. (Source: CNBC

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