Hong Kong Financial Services Sector to Work on Regtech, Trade Financing, Payments, Robo-Advisory Products with New Initiatives

The Financial Services and the Treasury Bureau (FSTB) in Hong Kong had announced last month that the Fintech Proof-of-Concept Subsidy Scheme (PoC Scheme) will be opening for applications from February 26, 2021.

According to a release, the PoC Scheme has been introduced to encourage traditional financial institutions to team up with Fintech firms in order to work on PoC initiatives related to innovative financial products and services.

The Secretary for Financial Services and the Treasury, Christopher Hui, stated:

“The ever-developing field of Fintech has brought more diverse and convenient financial services to society. The pandemic has also spurred wide adoption of Fintech. As an international financial center, Hong Kong is an excellent place to groom one’s Fintech business.”

Hui also mentioned that through the PoC Scheme, they’re hoping that the Fintech space will be able to take advantage of the opportunity to “proactively put forth and test various innovative and practical Fintech solutions and products, especially in areas that are increasingly mainstream and related to daily economic activities and people’s livelihood,” including Regtech, trade financing, cross-border payments and Robo-advisory services.

These initiatives should help with bringing Hong Kong‘s financial services sector to “a new level,” Hui noted.

Under the PoC Scheme, each approved PoC initiative will be offered a “maximum direct one-off grant of up to $100,000.” And “deserving” PoC initiatives with greater complexity and broader potential usage, like those focused on cross-sector or cross-border applications (like involving the Guangdong-Hong Kong-Macao Greater Bay Area or Association of Southeast Asian Nations) may be able to receive a grant of “up to $150,000.”

Financial institutions can offer other types of financial resources for the subsidized PoC initiatives. The Government has reportedly set aside $10 million for the scheme.

Applications have to be turned in by a Hong Kong-registered firm which has a permanent physical office based in Hong Kong and with its main business being focused on Fintech services. The company must work jointly with a financial institution that’s regulated by the Hong Kong Monetary Authority, the Securities and Futures Commission, the Insurance Authority and/or the Mandatory Provident Fund Schemes Authority.

The PoC project must focus on solving practical problems or issues faced by the financial services sector (with no prior use case already being offered in the market).

The FSTB has reportedly appointed Cyberport to administer and manage the PoC Scheme. Applications may be turned in through the Cyperport website (pocsubsidy.cyberport.hk) from February 26, 2021 until June 30, 2021.

Cyperport will be releasing details like application procedures and supporting documents needed on its official website.

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