Overcoming behavioural roadblocks to tech adoption in Hong Kong
Despite an economic downturn in recent years, new digital opportunities for Hong Kong businesses represent a positive outlook for the future. Designed to enable enterprises, SMEs, and individuals more efficient financial intermediation in the banking system and enhance financial inclusion in Hong Kong, the Commercial Data Interchange is a neutral and secure platform for sharing alternative financial data between banks and data providers when the data owners (i.e. enterprises, SMEs, or individuals) give their consent. This initiative led by the Hong Kong Monetary Authority (HKMA) will allow SMEs to better connect with banks and exchange data needed for secure financing. This represents part of the government’s vision for Fintech 2025, a strategy to drive the fintech development of Hong Kong.
Although Hong Kong’s SMEs are among the most digitally ready in Asia Pacific, they need to further leverage technology to deliver greater business efficiency. The latest Standard Chartered SME Index found that while Hong Kong SMEs generally associate “innovation” with improving products and services they have no idea how to apply it to business processes.
A recent behavioural science study by Xero One Step identified key behavioural barriers that hold SME owners back from adopting technology and the digital tools they need to thrive. For example, one of the common reasons business owners might refrain from making the digital shift is that they believe that what they have been doing is good enough. Another barrier is the fear of risk and short-term loss. The survey reported that six out of ten decision makers say that they desire predictability when it comes to decisions about technology. The report also found that two-fifths of SMEs say they feel confused when comparing technology options – a behavioural barrier defined as the inability to compare and understand the options on offer.
Technology providers and policymakers can help simplify this process by narrowing the number of choices on offer and benchmarking areas of comparison. Where there is more than one option, using like-to-like comparisons helps make the process less daunting. The more benefits that resonate with decision-makers personally, the greater their inclination will be to take that first step.
As such, it is critical for technology providers to find a balance between highlighting the value and importance of their tools and solutions alongside providing the guidance needed to help business owners overcome their relative judgement and choice paralysis.
There are, additionally, tools that SME owners can employ to help them better assess their options. A decision matrix, for example, can aid with visualising pros and cons against specific criteria. Another option is a pre-mortem, which starts with the end result and works backwards, creating a list of potential points of failure for both current and alternative solutions. Lastly, there is the power of community. Speaking to fellow SME owners is a great way to share learnings and get recommendations.
The promise of democratised data and open banking is just around the corner for Hong Kong’s small businesses. SMEs that are gearing up to recover from the recent speedbumps and grow in the new year will have the means to access financing quickly and seamlessly. But to do so, they have to embrace the next wave of transformation and overcome their behavioural roadblocks to adopt the technology they need.
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