Officials of the Hong Kong Monetary Authority (HKMA) have revealed that they have now reached a major milestone in their efforts to promote the use of financial technologies in the city's banking sector. High profile speakers at the recently held Asian Financial Forum revealed that more than half of Hong Kong residents are now using its cheaper and better banking services under its Faster Payment System.
The comments made by the officials were directly correlated to the successful launch and adoption of the HKMA's Fintech system, which essentially enables users to transfer money between banks for free through their mobile devices. Officials at the annual conference held by the Hong Kong government stressed that the development is evidence of how quickly the city has managed to adapt to the new era of digital banking.
It was also pointed out that the rapid evolution should be treated as a challenge by traditional lenders, which must now find new ways to innovate amid the rising competition. Hong Kong recently issued a number of virtual banking licenses to companies backed by tech giants such as Ant Financial and Tencent Holdings. The digital banks are expected to significantly shake up the banking industry in the city, placing added pressure on traditional financial institutions.
The HKMA issued a total of eight virtual backing licenses in March last year. Among those who received the licenses, ZA Bank, a unit of ZhongAn Technologies International Group, was the first to start operations last month.
The Secretary for Financial Services and the Treasury, James Lau, mentioned during a panel discussion on Monday that the HKMA's Faster Payment System has become very popular with the public. The adoption of the relatively significant Fintech system has been seen as an important step forward for the city as a whole.
The Faster Payment System, which is essentially a digital interbank payment system, was originally introduced by the HKMA in September 2018. The system itself was well received by the public with millions of people signing up to take advantage of the service. As of this year, the system reportedly has average daily transaction volumes of around HK$2.4 billion, or roughly around $308.82 million.
Hong Kong residents are able to sign up for the service using their mobile phones, using only their phone numbers of their email addresses. Through the service, users can transfer money between different bank accounts without any transfer charges. Through the service, users can also make payments at participating stores and restaurants through the service's built-in QR code system.
