The launch of new online-only banks in Hong Kong is expected to be delayed in part due to anti-government protests in the city, Reuters reports, citing people with knowledge of the matter.
Most of the eight newly licensed digital banks in Hong Kong, including joint ventures involving Standard Chartered and Bank of China Hong Kong, had aimed to begin operating before the end of 2019.
But as protests stretch into a fourth month, the new banks, seen triggering the biggest shake-up to Hong Kong’s retail banking sector in years, will now launch early in 2020, sources told Reuters.
Some of these so-called virtual banks had aimed to launch brand promotion campaigns as early as this month, but these plans have now been put off, according to the report.
“This form of banking service is mainly aimed at the youth, millennials, and many of them are out on the street these days joining the protests,” a senior executive at a license winner was quoted as saying.
“It will be difficult to launch a brand campaign around them and attract their interest when their priority is clearly not having another bank account,” said the executive.
Hong Kong awarded virtual banking licenses to three groups in March – joint ventures led by StanChart and BOC Hong Kong, and a subsidiary of the international arm of Chinese online insurer ZhongAn Online P&C Insurance.
The banks intended to launch services in six to nine months, the Hong Kong Monetary Authority said at that time.
Five more licenses were issued later to joint ventures led by smartphone maker Xiaomi and Tencent, and a unit of Ant Financial among others.
The launch delay is also partly due to the time required to build technology infrastructure, compliance and customer acquisition processes, and hire staff, according to the report.
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