Hong Kong Prepares for Virtual Banks
Already saturated the Hong Kong banking market is about to get even more competitive.
The Hong Kong Monetary Authority (HKMA), issued guidelines for the launch of virtual banks in the territory, a new public consultation will last until March 15, 2018, with a revised guideline to be issued in May 2018.
HKMA says in a revised guideline on authorization of virtual banks for public consultation, published on its website, it now welcomes the establishment of such banks, but there are updates on basic principles in their guidelines compared to the guidelines originally issued in 2000.
Prepare for Failure
Among the key points the de facto central bank highlight include, no minimum account balance requirement or low-balance fees, and parties looking to set up in Hong Kong will need to have at least HK$300 million in capital.
Banks, financial institutions and technology companies may apply to own and operate a virtual bank in Hong Kong. The application though, as virtual banking is a new business model, should also include a detailed exit plan.
