The Steering Group on Financial Technologies (Fintech) released a report in February which proposed a number of recommendations to further Hong Kong’s development as a Fintech hub.
The report highlighted the vibrancy of the Hong Kong Fintech sector comprising world-class financial institutions, innovative start-ups, investors, finance and entrepreneurial talent, and research and development (R&D) institutions. There is vast potential for Hong Kong to become a premier Fintech hub, through leveraging its role as an international financial center, the highly developed information and communication technology infrastructure, and ample finance and entrepreneurship talent.
The favorable Fintech ecology in Hong Kong has already attracted 48 out of 100 top Fintech companies in the world to operate in Hong Kong. Co-working space, accelerator programs and innovation laboratories run by Hong Kong as well as multinational financial and professional services firms act as platforms for expediting growth of participating Fintech start-ups as well as channels for incumbent financial institutions to keep abreast of the latest technology.
In his 2016-17 Budget, the Financial Secretary, Mr John Tsang, announced a range of measures for early implementation of the Steering Group's recommendations, including:
* establishing a dedicated team under Invest Hong Kong to organize international events and assist start-ups, investors and R&D institutions to establish their presence in Hong Kong;
* setting aside a dedicated space of 3,000 square metres in Cyberport's Smart-Space for Fintech activities and rolling out a designated incubation programme for 150 Fintech start-ups over the next five years;
* arranging for 300 university students, through Cyberport, to join Fintech training camps in overseas universities to gain more in-depth understanding of career prospects in the sector;
* establishing dedicated platforms at the Hong Kong Monetary Authority (HKMA), the Securities and Futures Commission and the Office of the Commissioner of Insurance to enhance communication between regulators and the Fintech community;
* setting up, by the HKMA in partnership with the other stakeholders, a three-pronged cyber security programme that comprises a cyber intelligence-sharing platform, the conduct of risk assessment and professional certification; and
* encouraging the industry and relevant organizations to explore the application of "Blockchain" technology in the financial services industry, with a view to developing its potential to reduce suspicious transactions and bring down transaction costs.
On the funding side, enterprises developing Fintech products and solutions can benefit from new and existing funding schemes, including the Innovation and Technology Fund (ITF), as well as the Innovation and Technology Venture Fund and the Cyberport Macro Fund announced in the 2016 Policy Address. Together, a pool of about US$ 641 million (HK$5 billion) is available to ventures and research projects in various technology areas including Fintech.