Current Status of Hong Kong’s Fintech Industry
All over the world, the fintech industry has experienced a significant upturn in fortunes. As more business owners, directors, and other important corporate figures recognize the importance of fintech than ever before, such people all over the world have been flocking to the fintech industry for the purposes of claiming some of its benefits for themselves. Such has also been the case in Hong Kong. Hong Kong’s banks, entrepreneurs, and government have joined forces in many ways so as to improve the status of the fintech industry in Hong Kong. They are determined to turn Hong Kong into a leading digital finance location in the world. The financial sector service of Hong Kong is large and it contributes nearly 18% of its total GDP. Approximately 220,000 people in Hong Kong are employed in the country’s vast financial sector. This figure is equivalent to 6% of the entire workforce. Many who work in Hong Kong’s financial sector are involved in fintech. Various factors attract people to work in Hong Kong’s growing fintech sector. Factors that have served to draw people to the fintech sector include the strength of the related financial sector in Hong Kong, the strong business culture, the high-level and high-quality technological infrastructure, and numerous funding opportunities. Furthermore, support provided by the government as well as much world-class talent also cause people to be drawn to fintech in Hong Kong.
Hong Kong is home to a fintech scene which has seen much growth. The country’s fintech sector has proven itself to be very conducive to the prospects of expansion. This in turn has permitted Hong Kong to improve its level of technological advancement in recent years. One way this rapid growth can be seen is in the increase in incubator and accelerator programs. The number of such programs in Hong Kong increased from three to 40 from 2010 to 2015. Additionally, the continuous growth of fintech in Hong Kong has turned the industry in Hong Kong into one with an active and vibrant community. Successful fintech events held in Hong Kong have displayed Hong Kong’s commitment to becoming a global fintech leader.
Recent Developments in Hong Kong’s Fintech Industry
The fintech technology present in Hong Kong has recently received many plaudits from organizations both within Hong Kong as well as from abroad. Some of these organizations include investHK as well as the United Kingdom’s Department for International Trade. Many major international fintech companies such as Mosaic Smart Data and Digital have established operations in Hong Kong and have also been able to help fintech companies in Hong Kong adapt to regulatory changes.
The government of Hong Kong has helped the fintech ecosystem there and also improved the existing level of financial innovation in Hong Kong. Those working in applied science as well as the public sector have played important roles in the development of fintech in Hong Kong.
Growth of Hong Kong’s Fintech Industry
According to a study conducted by Deloitte, Hong Kong is the fifth-largest fintech hub in the world. Hong Kong is only ranked behind London, Singapore, New York, and Silicon Valley. The position of Hong Kong as a fintech hub in Asia has increased its global prestige. Its proximity to China has also provided it with several additional advantages. Hong Kong’s fintech industry has also done a great deal to serve its population. Over time, it has helped to reduce the gap between the skills required for jobs and the employability rate. Hong Kong’s burgeoning fintech has provided meaningful and important insights which have been very useful in making career decisions and providing guidance to those who are willing to involve themselves closely in the development of Hong Kong’s fintech industry.
Hong Kong is experiencing an increase in fintech startups. New entries into Hong Kong’s fintech market are always making themselves apparent. These entries led to an increase in Hong Kong’s fintech revenue worth US$170 million. This figure is almost equivalent to that of Singapore and Japan combined; these countries posted increases of US$86 million and US$87 million respectively.
The fintech banking system of Hong Kong has aided in discovering inner workings of Hong Kong’s financial sector. The data gained has been used to improve the ability to fulfill customer demands, enable the making of decisions through the use of the data, ascertain risk levels, and determine the returns to be associated investments which are about to be made.
Hong Kong’s fintech sector has helped many learn how to manage financial innovations as well as how to handle the disruptors within a competitive financial landscape. It has enabled the exploration of new business models and also aided in the creation and maintenance of a successfully integrated technological ecosystem. The fintech sector of Hong Kong has aided in exploring new opportunities which have been necessary in the management of funds and changed how the country’s financial sector approaches global challenges.
How Fintech Has Contributed to Hong Kong’s Economic Growth
Fintech has created employment opportunities for many people in Hong Kong. As a result, Hong Kong has been able to increase its total gross domestic product (GDP). Such an increase in GDP is not only useful for the economic growth of Hong Kong; it also provides a source of revenue for infrastructural development. The country’s fintech industry uses artificial intelligence (AI) and robots to improve the efficiency and convenience present in the financial sector. The technology is said to be an improvement over cryptocurrency. Members of the fintech sector of Hong Kong project that AI is most likely to take over most accounting and financing activities over the coming years.
Fintech technology has brought together executives, entrepreneurs, investors, and various regulators for a common goal. The fintech technology of Hong Kong has not only brought the country global exposure; it has also attracted external investors who in turn have contributed large sums of money to the economy of Hong Kong. Today, Hong Kong’s fintech sector is one of most innovative and vibrant in the world is regarded as the most global innovative financial sector considering fintech economy.
International Reputation of Hong Kong’s Fintech Industry
Hong Kong is one of the fintech hubs of the world today. It has followed in the footsteps of neighboring China by making several strides towards embracing the new banking technology which exists in the fintech sector of the country. The fintech industry of Hong Kong has done much to impart financial knowledge among the population of Hong Kong. Such is also the case with regard to pre-existing finance mobile apps as well as cryptocurrency; these serve to provide more convenient services to customers. The AI-based knowledge in Hong Kong has also tightened the security of online transactions. It is for these reasons that Hong Kong’s fintech industry has a sterling reputation on the global stage.
Fintech firms are among the fastest-growing globally. This is because they serve as ways to improve the standards of machine learning and AI. Investment in Hong Kong’s fintech sector has been promising because the total amount of investment has been constantly rising. Furthermore, the government of Hong Kong has pledged to allocate HK$500 million towards the development of financial services there; the fintech sector is included in this.
Of course, not everyone is either able or willing to go to Hong Kong in order to work in the fintech industry there. Fortunately for such people, there are other locations within the Asia-Pacific region which have highly-esteemed and world-renowned fintech industries. Anyone interested in entering fintech in the Asia-Pacific region should consider these locations.
For example, in Sydney, fintech venture capital investment has seen a marked increase which has held true even through times of overall investment declines around the world in the fintech industry. Its fintech sector contributes 9% of Australia’s total GDP and is one of the largest in the region.
In Tokyo, both the national government of Japan as well as the city’s metropolitan government alike have worked to turned the city into a global center of the fintech industry. The fintech market of Japan has grown exponentially in recent years, and much of this growth was driven by an increase in the establishment of business-to-business fintech startups; the majority of these were based in Tokyo.
The government of Singapore has introduced the Financial Sector Technology and Innovation Scheme to encourage financial institutions across Singapore to comnuicate and work with fintech startups. A report by Ernst & Young showed that Singapore is the entry point of choice for most international fintech companies seeking to enter Asia. The fintech industry of Singapore is therefore the fastest-growing in Asia.
Incidentally, although you may be reading this on our Hong Kong website, we are a Singapore-based company and thus have much experience in dealing with all matters related to fintech and fintech companies there. We can assist anyone who intends to take advantage of the vibrant and constantly expanding fintech industry of Singapore. If you are interested in moving to Singapore to work in a fintech or any other company, contact us at any time. We will provide suitable advice which will enable you to receive an Employment Pass, which is the required work visa necessary for living and working in Singapore.
Fintech has helped banking systems around the world to integrate AI and machine learning in order to modernize the delivery of financial services. Hong Kong is one of the locations in the Asia-Pacific region where the impact of many contributions to the growth and development of the fintech industry can clearly be seen. The technological innovation that exists there has led to the growth of Hong Kong’s GDP and also created many employment opportunities among the people of Hong Kong. The industry has also offered convenient services to customers and also provided security to Internet transactions.
The Fintech Industry of Hong Kong FAQs
Which other areas of the Asia-Pacific region are the primary rivals of Hong Kong’s fintech industry?
Hong Kong is not the only major player in the fintech industry of the Asia-Pacific region. The Global Fintech Hub Report lists 12 other Asia-Pacific cities as being among the world’s 30 primary fintech hubs. These cities are Beijing, Shanghai, Hangzhou, Shenzhen, Singapore, Sydney, Tokyo, Guangzhou, Seoul, Nanjing, Bengaluru, and Mumbai.
Around the world, AI is one of the most important elements of fintech. Over 40% of all of the world’s fintech companies consider AI to be one of the most important technologies of which an individual should make use before making investment decisions. Such is true in Hong Kong as well. For this reason, Hong Kong’s fintech industry has placed a priority on the improvement of AI standards. This initiative has certainly been worthwhile, as is evidenced by the growth and success of Hong Kong’s fintech industry.