Online Banking Services in Hong Kong

Structure of Online banking

Just like traditional banks, online banks have also divided their services into departments, e.g., customer service, loan application, and cheque deposits.

Online banks can be in two forms:

Online-only bank
This type of bank exists exclusively online with no local branch. An example is ING an E*Trade.
Online wing of a traditional bank
This type of bank is a local/traditional banking system with an online presence or wing. It has evolved to include services online.

Mobile banking

Online banking has gone mobile thanks to the introduction of smartphone apps. HSBC has the HSBC HK Mobile Banking app. It allows one to conduct bank transactions from the comfort of their geographical locality and even outside banking hours as long as there is an internet connection. Businesses that conduct operations out of Hong Kong will be also able to access these banking services in real time.

Basic Functionality of a banking app

A secure sign-in system and reliable data storing and access if it is a banking industry.
Efficient account management
Customer support mechanism e.g., a Chabot
ATM locator
Push-notifications

Real-Time Gross Settlement (RTGS) Systems

RTGS transfers funds in real-time without having to wait for a credit and debit transaction to take place between the accounts doing the exchange. The central bank of a country uses them for cross-border transfers between countries.

Being an Online Banker

To be an online banker, one will need to open an account via the banking institution’s website or your mobile app and manage it, then register it for an online access. Apart from internet connection and web browser or mobile app, a person will require their bank account number and personal information to verify their identity like passport/Identity Card number. One starts by setting-up a login and password and then logs-in and start using the banking services online.

Types of Banking Services

Open Accounts

A client can open a checking account and/or savings account in about 10 minutes, depending on their technological skills. However, to open a corporate bank account in Hong Kong is still a complicated process. With new anti-money laundering regulation, it is harder for foreign companies to successfully open bank accounts.

Depositing Checks

There are several ways to deposit a check when banking online. One easiest and fastest way is through a mobile cheque deposit. You send a photo of the cheque to your bank for payment.

Paying Bills

A client’s bank can print and mail a check for clients as often as clients instruct, or send money to a payee electronically.

Transferring Funds

There are different areas of funds transfer.

A client can move money from a checking account to a savings account or
Transferring cash into a certificate of deposit (CD)
Opening a new Certificate of deposit
Transfer money to different banks
Send money to a particular individual via person-to-person services

Checking Transaction Statements (E-statements)

A client can check their history of transaction and even see if a check deposit has been cleared. These are the regular bank statement (s) made available online and are guarded by electronic safeguards. An advantage of this e-statements over the regular statements is that they are less likely to be obtained through identity theft.

Loans

To cope with the recession, one of the loans that the Hong Kong government provided was HK$50 billion for SMEs. As there were no risks for the banks, SMEs that applied for this loan were able to get their loans approved and processed in just 2 to 3 working days. Traditionally, this would not be possible as physical banks would take up to weeks for the same process.

While applying for loans, it would be beneficial to engage a professional service provider for assistance. Paul Hype Page has worked with many clients previously regarding such issues. If any enquiries surfaces, we are always here for you to consult.

Safety of Online Banking

Online banking is relatively safe as long as the banks are registered with the Hong Kong Monetary Authority. Online banking is generally safer than traditional banking as client deposits directly to their bank accounts, thus eliminating the risk of check theft and copying of account information.

The safety of online banking relies heavily on the client as he/she must ensure they trust the site they send their banking information. They should also protect their login information and verify the email recipients they correspond with by not providing sensitive information.

The client is also responsible for keeping their computer devices or mobile phones from unsecured access, as this can lead to identity theft or unauthorized login and transactions. They should ensure the devices have up-to-date security features like antivirus software and firewall.

Banking systems must ensure they have secure networks and maintain constant maintenance to avoid hacking of banking information.

Advantages of Online Banking

Better interest rates
Exclusively online banks offer the highest annualized interest rates on a client’s deposit because they have the overhead of brick-and-mortar banks and share their savings with clients.
They also tend to offer lower loan interest rates, thus reducing the total cost of loans.
Lower fees
A client can avoid monthly maintenance fees as they manage their accounts unlike in the local bank where personnel is employed to manage client’s accounts and because of a chance to land a free checking account.
Banks that belong to an ATM network may offer free access to ATMs in that network or reimburse fees at unaffiliated ATMs.
Exclusively online banking systems have the advantage of not having to pay for the cost of separate branches.

Disadvantages of Online Banking

Technology issues
A client must have the technological know-how to be comfortable with online banking. Also, should there be a power outage or computer issues, pressing transactions cannot be completed.
A client also may be at risk of online scams should they send information to people not well known as their personal information can be extracted from email texts.
Of course, not everyone has had the time to learn the intricacies of every bank’s online banking services and which bank is suitable for them. Instead, Paul Hype Page can share our knowledge and expertise in Hong Kong’s financial sector, the difficulties and opportunities of the sector. This will aid your decision-making process and allow your business to proceed smoothly.
In-person transactions
Banking online may not be practical for clients who frequently make large deposits or withdrawals and need to do so through a bank teller. This is because some banks have a daily mobile deposit and withdrawal limit.
To convince a bank to allow transactions beyond the set limit or request cash advance, a client must visit the local branch. This may be difficult if the bank’s branch is not within the client’s locality.
Unlike traditional banks, online banks cannot provide safety deposit boxes and official checks and notary services.
Detailed one-on-one/face-to-face information
In case of the need for clarification or detailed loan information, a traditional bank will be more advantageous than online banking as one gets to interact with the bank personnel on a one-to-one basis.
A banker must always be one step ahead by keeping accounts at an online-only bank to capitalize on the high-interest rates, and a traditional bank to capitalize on the low fees while retaining the option to use its in-person services.