How Hong Kong can maintain a competitive edge in fintech development
Kenny Shui and Jonathan Ng say Hong Kong should learn from Singapore, Australia and elsewhere to create a more helpful regulatory environment for foreign and start-up financial technology developers
The HKMA’s sandbox, along with the Securities and Futures Commission’s and the Insurance Authority’s new sandboxes are all examples of a “safe place” for fintech entities to test products in a restricted environment without the usual regulatory consequence of pilot activities.
We recently presented an advocacy study highlighting four aspects of the existing fintech supervisory sandbox that could be improved: collaboration, inclusivity, facilitation and scalability. It is encouraging to see that the HKMA’s enhanced sandbox reflects our considerations in at least three areas, but we still believe improvements can be made.
The first aspect is in collaboration. Plans to link the SFC’s and Insurance Authority’s new regulatory sandboxes with that of the HKMA, creating a single point of entry for cross-sector fintech, is welcome.
David Hudson talks about disruptions and fintech
But because Hong Kong has separate regulators, time and effort may still be needed to assess the viability of linking the three sandboxes. Thus, the government should consider a new administrative office, perhaps under the existing Financial Stability Committee. This would allow multiple inputs from different regulators, so the administrative office could ensure cross-sector regulatory procedures are more streamlined and efficient.
Hong Kong Monetary Authority set to invest in international infrastructure developers
