Digital Finance Development Is Our Top Priority: FS

Financial Secretary Paul Chan said on Monday that it’s Hong Kong’s top priority to digitalise its financial system.

In a video message played at the opening ceremony of Hong Kong's FinTech Week, Chan pledged to help enterprises, especially small and medium companies, gain access to the financial services they need.

Chan, who was unable to deliver the speech in person because he'd come down with Covid, noted that the number of fin-tech companies in the SAR had grown from around 180 five years ago, to over 800 today.

“That impressive growth has been powered by Hong Kong’s open market, a vigorous regulatory regime, the rule of law, sophisticated infrastructure and the free flow of capital and information,” he said.

“No less important, we are boosting our financial infrastructure. Thanks to our One Country, Two Systems principle, strengthening our connectivity with our country and the world at large.”

He also noted that the government has issued a policy statement on Monday morning on the development of virtual assets in Hong Kong.

“We want to make our policy stance clear to global markets, to demonstrate our determination to explore financial innovation together with the global, virtual-assets community,” the financial chief said.

Addressing the same event, the head of the Hong Kong Monetary Authority (HKMA), Eddie Yue, stressed the digitalisation of financial services will not compromise the stability of the markets, adding that officials will ensure appropriate safeguards are in place.

“The use of digital innovation needs to be complemented by a clear approach to money-laundering, financial and other risks. We continuously work with banks to achieve this. We also ensure that consumers and investors they understand the risks associated with investments in these still largely unregulated products,” he said.

“To do this, we need to put in place the right guardrails. And the basic principle is very simple – same activities, same risks, same regulation – so that digital assets performing similar functions to traditional products should be subject to similar regulations.”

Meanwhile, Yue said the HKMA is planning to issue the first batch of tokenised Green Bonds this year.

He said it will be on a pilot scale and doesn't expect the sum to be large.