Hong Kong's efforts to encourage a wave of new digital banking providers advanced today when the island's central bank published a set of revised guidelines for new entrants.
In September, the Hong Kong Monetary Authority (HKMA) said that it would facilitate the establishment of virtual banks as part of a wide-ranging set of reforms - from the introduction of faster payments to open API standards - intended to prepare the territory for a revolution in retail banking services.
To pave the way for the new virtual banks, which financial institutions and tech firms will be able to apply to own and operate, the HKMA has now published revised guidelines for public consultation.
The virtual banks should "play an active role in promoting financial inclusion" and take care of the needs of their target customers, with no minimum account balance requirement or low-balance fees.
The banks will be subject to the same set of supervisory principles and key requirements applicable to conventional lenders, needing at least HK$300 million (US$38 million) in capital. They will also need to submit an exit plan.
According to the South China Morning Post, 10 local and overseas firms have already expressed interest in applying, with the first licenses expected to be issued by the end of the year.