Hong Kong to launch HK$2 billion fund to support Fintech development
At the Internet Economy Summit 2017 organized by Cyberport, Prof. K C Chan, Secretary for Financial Services and the Treasury, of the Government of the HKSAR, confirmed that the government is setting its sights on enhancing the local payment services ecology in a bid to position Hong Kong as a hub for the application and setting of standards for cutting edge Fintech.
In a mood characteristically offbeat he also cited several industry initiatives aimed squarely at the addressing some of the challenges of the financial services industry including:
- Talent shortage: Beginning from the 2017/18 academic year, local universities will offer dedicated publicly funded first-year first-degree and senior year programs in Fintech
- The Hong Kong Monetary Authority (HKMA) will introduce the Faster Payment System in 2018 and to facilitate the development of new electronic and mobile payment channels for various government services
- The Securities and Futures Commission (SFC) has initiated an internal Regtech project to actively assess technologies it can adopt to supplement its standing operations
- Insurers will establish a cybersecurity platform to exchange intelligence on threats and to handle security incidences
- The HKMA is undertaking research and proof of concept (Poc) on central bank digital currency in collaboration with Hong Kong’s three note-issuing banks, Hong Kong Interbank Clearing and R3
- The HKMA is piloting a PoC project for trade finance in collaboration with a consultancy firm and five banks in Hong Kong
- A new HK$2 billion Innovation and Technology Venture Fund will be launched over the next few months to help bridge the funding gap for technology start-ups. It will jointly invest with VC funds in local innovation and technology start-ups to create a more vibrant ecosystem in Hong Kong
Chan noted that under the supervision of the SFC, the city has seen the launch of new financial offerings such as on-line fund distribution, robo-advice, and a fund structure that invests in the peer-to-peer (P2P) loan market.
Speaking at the Internet Economy Summit 2017, Cheng Li, Chief Technology Officer of Ant Financial Services Group disclosed how Ant Financial provides more inclusive financial services by better connecting financial services with consumers, ensuring lower barrier of entry for equal access, and devising ways to innovate financial services.
To emphasize the importance of distributed ledger technology (DLT), Tim Grant, Chief Executive Officer of R3 Lab and Research Center noted that DLT will redefine the foundations of finance. It is found that financial services are spending USD2.6 trillion on operating costs now but DLT could dramatically reduce cost base.