The Hong Kong Monetary Authority announced on Thursday that it is handing out four more virtual banking licenses.
Ant SME Services (Hong Kong), Infinium, Insight Fintech HK, and Ping An OneConnect Company have all been given the regulatory thumbs up from the HKMA.
The granting of banking licenses to those firms means there are now 160 regulated banks operating in Hong Kong.
“We are pleased to grant four more virtual banking licences today,” said Norman Chan, the HKMA’s chief executive officer. “The HKMA is now working closely with the eight virtual bank licensees to prepare for the launch of their business operations in accordance with their plans.
“The launch of virtual banks in Hong Kong, which is a key component of the Smart Banking Initiatives, will certainly facilitate financial innovation, enhanced customer experience and financial inclusion.”
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Regulation now, products later
The Hong Kong regulator announced the launch of the virtual banking license a year ago. In August it published an update saying that it had received 30 applications for the new license.
Following that, the regulator said in December that a third of those applicants were unable to meet the requirements needed to get its approval.
In March, the HKMA granted its first three licenses and, at the start of April, the financial watchdog issued one more to Welab Digital.
Although the regulator issued another four licenses this Thursday, it may be some time before we actually see the products those companies plan on bringing to market.
A statement issued by the HKMA indicates that it will take from half a year to nine months for the digital banking firms to launch their services.
Once they do, the regulator is going to be watching closely. The HKMA said in its statement that it plans on monitoring the impact virtual bank’s have on the banking industry and how customers respond to their products.