Hong Kong's Unique Advantages
There are many factors that make Hong Kong ideal for FinTech companies. The city offers a world-class business environment, unmatched financial and operational support, and excellent technical infrastructures to support innovation and business on a global scale.
- Hong Kong is among the world’s top ten fintech hubs. In 2018, Hong Kong ranked 5th in digitalisation of the traditional financial sector, and the percentage of its fintech users in Hong Kong reached 35.1%. In 2019, the consumer fintech adoption rate reached 67% in Hong Kong.
- Hong Kong ranked as the 4th most innovative economy in Asia in 2019, according to Cornell University, INSEAD, and the World Intellectual Property Organization.
- Government departments are looking for innovation and technology (I&T) solutions that are conducive to enhancing public services or their operational effectiveness. Suppliers are welcome to check on the current business and operational needs and propose innovative solutions or products suggestions to address them.
- In 2018, Hong Kong ranked 5th in EY’s Open Banking Opportunity Index.
- Hong Kong currently has at least eight unicorns (start-ups valued at US$1 billion), including Airwallex, a cross-border payment service provider, TNG, a fintech company, WeLab, an online lending platform, Lalamove and GoGoVan, both in logistics business, BitMEX, a virtual asset trading platform operator, Klook, a travel product booking platform, and SenseTime Group, an artificial intelligence company.
- The city offers easy access to the Greater Bay Area, with advanced supply chain and logistics platforms.
- The city is a business centre that connects Mainland China with global markets, making it ideal for start-up and existing companies to develop and apply FinTech.
- Its location puts companies in proximity to China's financial technology leaders and offers close association to giants like Alibaba, Tencent and Baidu.
- As a well-connected international financial hub in a favourable time zone, Hong Kong is ideal for FinTech businesses to scale globally.
- The city offers an enormous base of highly skilled workers, supported by many well-respected institutions for higher learning.
- Since 2010, Hong Kong fintechs have raised US$940 million, nearly one-third more than the amount raised by Australian fintechs and more than double the amount raised by fintechs in Singapore and Japan (Source: Accenture).
- The Hong Kong government’s 2018 budget pledged to allocate HK$500 million to the development of financial services over the next five years, including fintech.
- In terms of resourcing and funding, the Hong Kong government has announced a series of supporting funds and schemes in the 2017-2018 budget policy address specifically for start-ups and Fintech. Key initiatives include setting up a new committee on Innovation & Technology (I&T) development and re-industrialisation; and extending the Public Sector Trial Scheme to include the incubatees of two important incubators - the Hong Kong Science and Technology Park and Cyberport since the end of last year. The latter scheme will provide each eligible project with a maximum subsidy of $1 million, seeking to encourage the public sector to conduct trials on the start-ups' products and services.
- Also, a new HK$2 billion Innovation and Technology Venture Fund will be launched to help bridge the funding gap for technology start-ups. It will jointly invest with VC funds in local innovation and technology start-ups to create a more vibrant ecosystem in Hong Kong.
- Dedicated FinTech platforms established by the Hong Kong Monetary Authority (HKMA), Hong Kong Securities and Futures Commission (SFC) and Insurance Authority (IA) help enhance communications between regulators and the FinTech community—keeping all parties up-to-date on regulations, new developments and more.
- HKMA, SFC and IA have launched Sandboxes to facilitate the development of Fintech in Hong Kong.
- The city boasts many spaces, accelerators, incubators and networking events supported by financial institutions and venture capital firms.
- The Hong Kong Government embraces a "technology neutrality" principle and investor protection—fostering an environment conducive to innovation.
- Hong Kong boasts a large and growing pool of world-class talent. The Hong Kong University of Science & Technology was ranked 4th in Asia in the 2015-16 QS World University Rankings.
- Hong Kong has two universities in the world's top-50 and five in the top-200, helping to grow the city's skilled labour force and offering research support for businesses.
- Hong Kong's business schools are also world-renowned; the Hong Kong University of Science & Technology's EMBA programme ranks second in the Financial Times EMBA Rankings 2015.
- Hong Kong government has launched the Technology Talent Admission Scheme (TechTAS). The scheme aims at accelerating the admission of R&D talent from overseas and the Chinese mainland. Maximum of 1,000 people will be admitted in the first year.
- Hong Kong has strong academic institutions and innovation labs to nurture technological growth, giving FinTech firms access to new technologies that enhance innovation and operational efficiency.
- HKMA and ASTRI have launched the Fintech Career Accelerator Scheme (“FCAS”) to nurture the talent needed to meet the growing needs of Fintech in Hong Kong. FCAS is supported by 11 banks and 9 universities and will provide internships for undergraduate and postgraduate students interested in a career in the Fintech industry.
- Beginning from the 2017/18 academic year, The Chinese University of Hong Kong will offer Bachelor of Engineering Programme in Fintech, while The Hong Kong Polytechnic University will offer Bachelor of Science in Fintech; both of which are a dedicated publicly-funded degrees in Fintech at our local universities.
- Hong Kong has the world's second-fastest Internet speed, with over 92.6Mpbs average peak connection (Akamai Technologies, Q1 2015) and over 83% household broadband penetration (OFCA, Mar 2015).
- Smartphone penetration rate ranks top in Asia at more than 232% (OFCA, April 2015).
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