HK’s online banking push pits tech newcomers against old lenders

At least a dozen banks, fintechs and telecom firms are lining up to get a piece of Hong Kong’s retail and small business banking market as the regulator prepares to award Hong Kong’s first online-only banking licenses.

Bidders hoping to challenge the dominance of HSBC and its local rivals, Bank of China (Hong Kong) and Standard Chartered, include China’s Ant Financial, Tencent and Ping An Insurance, several people familiar with the process said.

StanChart on Thursday said it had set up a new entity for digital banking and had submitted an application for a license. Hong Kong-based fintech company WeLab Holdings also said it had applied.

Hong Kong telecoms opera- tor HKT Trust and HKT said they would apply.

The deadline for the first batch of applications is Friday, and others expected to apply include Bank of China (Hong Kong), Chinese smartphone maker Xiaomi and online insurer ZhongAn, said the sources and local media.

On offer is access to a rich banking market where many consumers are unhappy with their current options, according to research last year from Accenture. The research showed that only 53 percent of consumers in Hong Kong are satisfied with their banks, compared to 88 percent in the US and 72 percent in Australia.

Small firms, who have long complained about the difficulties of opening bank accounts in Hong Kong, will be one target of the new online lenders, with small loans, foreign exchange and payment services among those on offer, the sources said.