Virtual banking is now a reality in Hong Kong, after its financial regulator published a guideline granting banking status to financial institutions without the need for physical branches.
The guideline broke free from the long-established three-tier banking system in Hong Kong - licensed banks, restricted license banks and deposit-taking companies. 29 virtual bank license applications were filed as of 31 August, 2018 deadline. This is a compelling figure, considering there are only 22 locally incorporated banks in Hong Kong.
The banking sector is set to play a more active role in the semi-autonomous Chinese territory’s grand ambitions to transform itself into a ‘smart city’, amidst the backdrop of intensifying regional and global digitization.
This article outlines five critical areas for virtual banks aspiring to succeed amongst the long-established banking giants in Hong Kong’s hyper-competitive market:
- Customer focus
- Continuous product innovation
- Partnerships and cooperation
- Regulators’ role
- New and existing infrastructure