Learn more about our comprehensive legal services.
Advising our clients on different opportunities and challenges of the industry.
News & Insights
Authored by: Isabella Wong
On 25 August 2023, the Hong Kong Monetary Authority (HKMA), the Securities and Futures Commission (SFC) and the Insurance Authority (IA) jointly published a new roadmap, which sets out their regulatory initiatives over the next 12 months for promoting Fintech adoption in the financial services sector.
Similar to Singapore’s collaborative initiative with the financial industry that seeks to test the feasibility of applications in asset tokenisation and decentralised finance (see Project Guardian issued by the Monetary Authority of Singapore in June 2023), Hong Kong’s financial services regulators have collaborated to implement various Fintech policies and initiatives including Fintech supporting infrastructure for Hong Kong financial institutions. The roadmap summarises the HKMA’s Fintech adoption study, the three regulators’ past and existing Fintech facilitation measures and their Fintech promotion initiatives between 25 August 2023 and 24 August 2024.
Below are the key take-aways of the roadmap for SFC licensed asset managers:
1. Wealth / investment services and ESG factors are focus areas for Fintech promotion: the regulators aim to facilitate the application of technology in financial institutions’ business operations, covering financial planning, investment management, investment execution, client communication, and the collection of ESG related data. Hyper-personalised and low-cost wealth, investment and/or ESG solutions will become a trend.
2. The adoption of artificial intelligence (A.I.) and distribution ledger technology (DLT) will continue in Hong Kong:
3. As part of the roadmap, the regulators will issue guidance on Fintech adoption in the financial services sector. First, a best practice guidance will be published by the HKMA covering topics on contract negotiation between financial institutions and Fintech solution providers, financial institutions’ on-boarding of technology vendors and cyber-security. With respect to asset managers, the SFC will likely issue a circular on fund tokenisation which we expect will provide some regulatory clarity on the tokenisation of public funds. Other than the best practice guidance, the planned regulatory initiatives aim to bridge the connectivity between financial institutions and Fintech solution providers through:
Hong Kong’s Fintech regulatory landscape continues to evolve. The Fintech Promotion Roadmap (and in particular, the Fintech Knowledge Hub) may assist asset managers in tracking developments in Fintech knowledge and market experience.
Subscribe to Publications
Sign up for our regular updates covering the latest legal developments, regulations and case law.
For media enquiries please contact us at email@example.com.
Tel: +852 2825 9211