The Hong Kong Monetary Authority (HKMA) has granted its first tranche of virtual banking licences.
The first Hong Kong-based institutions to have received licences to operate under the Banking Ordinance are Livi VB, SC Digital Solutions and ZhongAn Virtual Finance. The licences will enable them to operate in the form of a virtual bank from today.
Norman T.L. Chan, chief executive of the HKMA, said that the introduction of virtual banks in Hong Kong is a key pillar supporting its entry into the era of smart banking.
He said the move was a a major milestone in reinforcing Hong Kong’s position as an international financial centre and added that virtual banks would not only help drive FinTech and innovation, but also bring about new customer experiences and further promote financial inclusion in Hong Kong.
“As virtual banks will have no physical branches, they will rely on the internet for customer acquisition and for the delivery of banking services,” Chan continued, adding: “I believe that virtual banks will have to offer innovative and customer-centric services in order to attract customers.”
According to the banks’ business plans, these three newly-licenced virtual banks intend to launch their services within six to nine months, taking the number of fully licensed banks in Hong Kong to 155.
The HKMA said it was making good progress in the processing of the remaining five virtual bank applications.
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