The rise of virtual banking in the greater China region is set to be one of the key themes at the 2019 Hong Kong FinTech Week scheduled for 4 – 8 November.
Hong Kong is expected to become one of the pioneering hubs of digital banking in Asia, following the issuance of a swathe of virtual banking licenses in the first half of 2019 by the local monetary authority.
The Hong Kong Monetary Authority (HKMA) granted a total of eight virtual banking licenses during the period from March to May 2019, to key players including Ant Financial, Ping An Group, Tencent and Xiaomi.
The shift is expected to cause major disruption to Hong Kong’s traditional banking sector, with a recent survey from Forrester Research finding that nearly a fifth of Hong Kong adults could consider switching to digital only banks within the next two years.
Forrester Research believes these established banks have less than two years to improve their digital services game, with virtual banks commencing the launch of digital-only offerings by early 2020, and strong results anticipated by 2021.
It also expects virtual banking to improve the fortunes and competitive edge of mainland financial institutions vis-a-vis their Hong Kong peers..
A review of the functionality of mobile banking apps provided by Bank of East Asia, DBS Bank, HSBC and Standard Chartered Bank found that they compared poorly to mainland competitors including ICBC, China Merchants Bank and Ping An Bank.
“Operators linked to and empowered by mainland China-based digital giants will certainly have an advantage with strong, modern technology stacks and unfettered customer obsession…as well as insights-driven operating models.”
The increasing popularity of digital-only banks and insurers that operate without physical branches is set to be one of the key themes at the 2019 Hong Kong Fintech Week held from 4 – 8 November.
A total of 15 digital-only banks from around the world will feature at the event, including seven of the Hong Kong virtual banks that obtained licenses from HKMA in the first half of 2019.