Hong Kong: Fintech start-up hub

Government, financial institutions and entrepreneurs are collaborating to make Hong Kong a breeding ground for fintech start-ups.

With the support of Hong Kong's government, financial services enterprises and tech entrepreneurs are making bold moves — and investing significant sums — to establish a firm foothold in the financial technology (fintech) space.

Fintech is revolutionising the business of banking and customers' relationships with financial institutions. Hong Kong's government highlighted fintech as a key focus and set out to promote its development to establish Hong Kong as a hub for the application of cutting-edge fintech.

Hong Kong's financial regulators have spearheaded a range of initiatives to foster fintech. One remarkable undertaking is the Hong Kong Monetary Authority's (HKMA) Fintech Supervisory Sandbox, allowing banks and their partnering fintech firms (including start-ups) to jointly develop and test new models, products and technologies. Recently, HKMA has announced their plan to upgrade their Fintech Supervisory Sandbox with new features, alongside the launch of similar sandboxes by the Securities and Futures Commission and the Insurance Authority to facilitate financial innovation. HKMA has also partnered with the Hong Kong Applied Science and Technology Research Institute in establishing a Fintech Innovation Hub and a talent-nurturing Fintech Career Accelerator Scheme.

The Hong Kong Special Administrative Region Government and regulators are also busy forging new collaborations with counterparts in other fintech hubs. In September, Hong Kong and the United Kingdom signed the Fintech Bridge Agreement, covering government-to-government (G2G), regulator-to-regulator (R2R) and industry-to-industry (I2I) co-operation. This agreement will provide a solid framework for fintech firms on both sides to use the facilities and assistance available to explore business opportunities in each other's jurisdictions.

Apart from co-operation with the UK, Hong Kong's Securities and Futures Commission has entered into co-operation agreements with the Australian Securities & Investments Commission, Dubai Financial Services Authority and Securities Commission Malaysia respectively to foster collaboration in fintech innovation. These agreements will enhance co-operation on information exchange and experience sharing between the parties involved.

InvestHK, a government organisation that fosters inbound investment and helps overseas and Mainland companies set up in Hong Kong, operates a dedicated fintech team, tasked with encouraging foreign fintech-focused firms to establish headquarters or expand in Hong Kong. They believe this will result in a 'snowball effect'.

"Talent attracts talent, and investments attract even more investments," says Charles d'Haussy, Head of Fintech at InvestHK. "Hong Kong's deep talent pool and its ability to attract foreign investment play major roles in its appeal as a fintech hub. It's crucial to attract foreign talent to Hong Kong to enable knowledge transfer, especially in fintech," he says. "Therefore, we not only aim to attract and retain foreign direct investment, we also aim to attract talent from all over the world to enter our fintech industry and ecosystem." Mr d'Haussy points out, however, that "developing local talent is equally important — if not more so."

There are many inherent qualities making Hong Kong a prime fintech start-up hub, Mr d'Haussy says, including, "its very strong legal system and financial services sector, along with its appetite for innovation. It has a deep-rooted culture of business and trade which fosters enterprise and a desire to try out ideas". Given its proximity to Mainland China and voracious domestic appetite for tech, "Hong Kong also offers the potential for real scale — the upside is huge," he says. "Hong Kong has the highest mobile subscriber penetration rate in Asia, at over 237 per cent. Customers are driving demand towards a mobile-first digital economy, which in turn creates virtually unlimited potential for financial services and start-ups."

In Mr d'Haussy's view, "Hong Kong's prospects are bright as a fintech hub." He cites competitive advantages such as the size of the stock exchange, which saw 126 new company listings last year, raising a total of about US$25 billion making Hong Kong the top market globally for IPO funds raised in 2016. With 155 banks, more than 600 stockbrokers, and over US$2 trillion in assets under management, Mr d'Haussy says Hong Kong boasts "a huge market for fintech companies looking to act as third-party suppliers to incumbents and medium-size players, as well as a ready supply of talent with financial services skills."

The private sector is eager to stay in step with innovations that are changing the way we bank, trade, make and receive payments, and analyse investments.

More and more financial institutions are providing support to fintech start-ups. In Hong Kong, Accenture runs the Asian edition of its annual FinTech Innovation Lab, a 12-week accelerator programme that forges bonds between early-stage fintech companies and top banks in the region. Standard Chartered is also behind a similar annual accelerator, named SuperCharger.

Fintech innovators, once considered a threat to traditional institutions, are increasingly seen working in unison with legacy organisations. One notable Hong Kong example is WeLab, the operator of a variety of online lending platforms, which has secured equity funding from investors including an established international bank. Another is CompareAsiaGroup, a financial services comparison platform that partners with a number of multinational financial institutions.

Many Hong Kong-based fintech start-ups are garnering attention on the regional and global stage. They include:


Contineo is a messaging network for private banks and wealth management firms, connecting them with issuers of structured products.


Founded by two former investment bankers, Quantifeed is a tech-based wealth management and automated investment solutions provider, offering a 'white label' digital investing platform for banking and investment services providers.

TNG wallet

This electronic wallet mobile app facilitates peer-to-peer transactions, money transfers, point-of-sale purchases, bill payments and cash withdrawals.

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