Virtual bank is defined as a bank which primarily delivers retail banking services through the internet or other forms of electronic channels instead of physical branches.
The introduction of virtual banks in Hong Kong is a key pillar supporting Hong Kong’s entry into the Smart Banking Era. The HKMA believes that the development of virtual banks will promote fintech and innovation in Hong Kong and offer a new kind of customer experience. In addition, virtual banks can help promote financial inclusion as they normally target the retail segment, including the small and medium-sized enterprises (SMEs).
Authorization of Virtual Banks
To facilitate the introduction of virtual banks, the HKMA published a revised Guideline on Authorization of Virtual Banks (Guideline) on 30 May 2018, setting out the principles which the HKMA will take into account in deciding whether to authorize virtual banks.
As set out in the Guideline, in considering whether to approve or refuse an application for authorization, the HKMA needs to be satisfied that the minimum criteria for authorization in the Seventh Schedule to the Banking Ordinance (Ordinance) are met. Reference should therefore be made to the “Guideline on Minimum Criteria for Authorization” issued by the HKMA under section 16(10) of the Ordinance for details about the manner in which the HKMA will interpret these licensing criteria.
In this connection, companies intending to apply for a virtual banking licence are recommended to study carefully the information and the requirements as set in the HKMA’s Guide to Authorization, particularly Chapter 2 – The Authorization Regime, Chapter 4 – Authorization, and Chapter 8 – Application Procedures.
Should you have any enquires on application process for an approval to set up a virtual bank in Hong Kong, please email to firstname.lastname@example.org.
Please click here for information about the respective virtual banks.
Virtual banks are subject to the same set of supervisory requirements applicable to conventional banks.
That said, some of the supervisory requirements are adapted to suit the business models of virtual banks under a risk-based and technology-neutral approach.
- 09 Dec 2019 Opening Remarks at Hong Kong Economic Summit 2020 (Chinese version)by Eddie Yue, Chief Executive, Hong Kong Monetary Authority
- 06 Nov 2019 Keynote Speech at Hong Kong Fintech Week 2019by Eddie Yue, Chief Executive, Hong Kong Monetary Authority
- 01 Nov 2019 Keynote Speech at HKAB Distinguished Speaker Luncheonby Eddie Yue, Chief Executive, Hong Kong Monetary Authority
- 26 Sep 2019 Keynote Speech at the 11th Hong Kong Institute of Bankers Annual Conference (PDF File, 479.6 KB)by Arthur Yuen, Deputy Chief Executive, Hong Kong Monetary Authority
- 10 Jun 2019 Caixin Summit 2019 (Chinese Version Only)by Arthur Yuen, Deputy Chief Executive, Hong Kong Monetary Authority
- 27 Mar 2019 Granting of Virtual Banking Licences (PDF File, 109.3 KB)by Arthur Yuen, Deputy Chief Executive, Hong Kong Monetary Authority
- 30 May 2018 Guideline on Authorization of Virtual Banks (PDF File, 70.7 KB)by Arthur Yuen, Deputy Chief Executive, Hong Kong Monetary Authority
- 06 Feb 2018 Guideline on Authorization of Virtual Banks (PDF File, 194.2 KB)by Arthur Yuen, Deputy Chief Executive, Hong Kong Monetary Authority
- 29 Sep 2017 A New Era of Smart Bankingby Norman T.L. Chan, Chief Executive, Hong Kong Monetary Authority
(Opening Keynote Speech at HKIB Annual Banking Conference 2017)
- 18 Dec 2019 Arthur Yuen on A Brand New Experience with Virtual Banks
- 06 Nov 2019 Eddie Yue on Embracing Financial Technology (Fintech) (Chinese version only)
- 01 Nov 2019 Eddie Yue on Partnership with the Banking Industry (Chinese version only)
- 02 Oct 2019 Eddie Yue on Steering a Steady Course while Upholding Professionalism
- 29 Sep 2017 Norman Chan on A New Era of Smart Banking (Chinese Version)