The Hong Kong FinTech Week 2018 event, which concluded last Friday, outlined hope that financial technology has a future in this city. So what did we learn?
Cryptocurrencies are finally being taken seriously in Hong Kong. The Securities and Futures Commission (SFC) announced new regulations for digital asset funds and a “sandbox” for new exchanges. Oh, let’s all welcome in more ways to lose our money.
Expect more innovation around payments. You know that when government authorities launch a Faster Payments Service and HSBC is running a surprisingly good service with Payme that payments are taking off in a big way. An estimated 29 companies are reported to have applied for virtual banking licenses. Still, expect to use your cash a lot… and remember that the taxi driver won’t take your HK$500 without a fight.
FinTech has truly come of age. Expect the battle between private sector and government to rage on. Open banking is certainly in the trend. “Banking is no fun. Banking is transactional in nature, and the question is how do we offer this professional service without interrupting your life,” said Angel Ng, CEO, Citi Hong Kong and Macau, at the conference.
Scepticism will continue around blockchain. When NYU Professor and famed global economist Nouriel Roubini called blockchain “the most over-hyped technology ever, no better than a spreadsheet/database” and cryptocurrency “the mother of all scams and (now busted) bubbles”, people took notice.
At the FinTech conference last week, Paul Schulte, founder and CEO of Schulte Research refuted the notion that ‘blockchain is bullshit’, during a presentation. “No. It’s free and it will succeed. It offers transparency and can become an auction house for anything that moves. It’s verifiable, immutable, traceable, automated, low cost, decentralized, IOT connected, secure, etc. China is ahead.” Ok, well let’s see.
Tech companies consider banking: Xiaomi co-founder Hong Feng cited the company’s 300 million mobile users that will allow it enter financial services. “We’re able to leverage hardware with software: mobile to payment card or entry card; wearables to payments and entry for transportation services… Banks just look at the balance sheet, which is simply the end-result… Xiaomi looks at the lifestyle,” he said.
Should banks be scared? On the one side, everyone and their mother is getting into banking. But can FinTech and tech companies really destabilize the big players? The smart money is on institutions co-opting FinTech for their own profit; don’t hold your breath on a revolution.
Having said that, Chad West, CMO of UK-based Revolut, revealed some home truths. The bank offers its 3 million retail customers multiple currencies with real exchange rates, free international ATM withdrawals, free international money transfers, interbank exchange rates, real-time transactions, payment notifications, cryptocurrency exchange and more. When West said: “banks have stung consumers on fees for years,” does that sound familiar?
There will be no chance of getting away from government buzzwords. The “Greater Bay Area”, “Hong Kong-Zhuhai-Macao Bridge” or even the “Belt and Road” will not be leaving your life anytime soon, so you better make yourself numb to it. YAWN…zzzzzzzzzz
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