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Amid the spread of coronavirus, major tech companies that have expressed interest in becoming digital banks have upped their game in crisis response by applying speed and showing care for their user base.

On 6 February, Bank of China (BoC) Hong Kong, one of three currency-issuing lenders in the city, was a first-mover in offering relief to clients affected by the viral outbreak, according to reports in «South China Morning Post».

Then about three days later, two of Hong Kong's largest banks – Standard Chartered and HSBC – announced billions of dollars in support measures as the novel coronavirus outbreak threatens to derail the special administrative territory's economy. While all measures are a relief welcome, one wonders why it took them almost a week later than big technololgy giants, to get their act together.

Big But Fast

The response time of the fastest bank in Hong Kong is noteworthy of praise, but in an era where digital banks and 'same-day' payments are becoming common, this may soon become an unacceptable standard.

In comparison, Tencent, through its insurance arm WeSure, rolled out its Covid-19 insurance coverage five to seven business days earlier. Launched on January 29 together with Axa and DingXiangYuan in China, the firm's Covid-19 medical worker insurance plan is the first in the market that pays cash compensation upon diagnosis. Upon rollout, over 100,000 medical professionals across China signed up for the plan within just one week. 

One Week Makes a Difference

Granted that the outbreak is happening in China and China's tech giants are likely to have faster information, the response time in Hong Kong should not have differed so much, especially when the number of infected persons across the border rose by the day. Moreover, banks traditionally have longer and deeper working relationships with insurers.  

One might argue that one week, in a corporate's lifetime, would not have made a difference. But it does, especially for healthcare workers who face life and death situations every day, and have a high probability of getting infected.  

Dripping Aid?

Relief measures from China’s banking giants in response to the outbreak came in drips and mostly earmarked for fighting the virus. The nation’s largest lender, Industrial & Commercial Bank of China (ICBC), said it offered relief to only about 5 percent of its small business clients, according to a report in «Bloomberg»(behind paywall).

Chinese banks as a group had offered about 254 billion yuan in loans related to the containment effort as of Feb. 9, according to the banking industry association, including foreign lenders, who also lowered rates. To put this figure into context, one has to look at the overall demand by China’s small businesses, which typically need 36.9 trillion yuan of loans every quarter.

Apply for Cover vs. Here's an Umbrella

Some banks still practice the old method of processing applications as they come, while others provide blanket-wide support for all clients. ICBC, China's biggest lender, approves qualified small businesses’ loan applications as soon as they arrive, whereas some international banks promise bill maturity extensions to all clients reliant on global trade. The difference is subtle but huge.