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7 = 3+4 Virtual Bank Licenses Awarded

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  1. #31

    Join Date
    Dec 2018
    Posts
    587
    Quote Originally Posted by threelittlepigs
    I love how everything is being blamed on the protesters. These banks can't hire enough staff to get the HKMA onboard with their control infrastructure. That has nothing to do with protesters. Unless one argues the potential staff are busy protesting and not interviewing. I've heard Livi is not even close to being staffed up, and they have a huge banking team to draw from.
    Agree with this.

    Also, even when they are up and running, I suspect it will be harder than expected to gain traction in Hong Kong at the moment anyway due to a number of factors.

    In times of uncertainty, people tend to stick with known believing (rightly or wrongly) it's safer. In this case that means keeping your money in a known bank rather than exposing yourself to something new. Also, the traditional banks are upping their game - day-to-day banking is all but free: there are no account charges, no changes for local payments/cash withdrawals, no changes for credit cards and no charges for holding securities. The only charges most people will pay are for international remittances (including FX conversion spreads) and trading in securities. Unless you do a lot of the latter, it seems that the incentives for opening a new bank account are unlikely to justify the cost and inconvenience of going through the account opening process?

    Also, the traditional banks have upped their game in terms of mobile access giving even less reason to move an account over.

    In summary, I'm struggling to see why I personally would benefit from opening an account with one of the new virtual banks?

  2. #32

    Join Date
    Aug 2013
    Location
    The World
    Posts
    663
    Quote Originally Posted by threelittlepigs
    I love how everything is being blamed on the protesters. These banks can't hire enough staff to get the HKMA onboard with their control infrastructure. That has nothing to do with protesters. Unless one argues the potential staff are busy protesting and not interviewing. I've heard Livi is not even close to being staffed up, and they have a huge banking team to draw from.
    But King Arthur and Fanny Law told us that the protesters are academic failures and prostitutes so surely that can't be the reason! =P

  3. #33

    Join Date
    Oct 2006
    Location
    Hong Kong
    Posts
    13,418

    I really hope the new digital entrants start offering decent savings interest rates, but unlikely.


  4. #34

    Join Date
    Feb 2019
    Posts
    56
    Quote Originally Posted by traineeinvestor
    I suspect it will be harder than expected to gain traction in Hong Kong at the moment anyway due to a number of factors.

    In summary, I'm struggling to see why I personally would benefit from opening an account with one of the new virtual banks?
    This is interesting and a question that I have been seeking to find answers for....from HKMA.

    For each of the license winners, the agendas are different.
    1. SCB wants to build a new bank with a technology stack that can replace existing stacks in all of their markets.
    2. ZA/Ant Financial/TenCent wants to learn how they can do banking so they can scale their business in China and other places.

    The ones to watch out for, I think:
    Livi
    Insight Fintech (Xiaomi JV)

    Any of them launching ay any mass market scale in Q1 2020 will be a huge win for their agendas but really not sure what they do for customers.

    HSBC can kill them all by converting PayMe accounts to bank accounts....
    traineeinvestor and shri like this.

  5. #35

    Join Date
    Dec 2018
    Posts
    587
    Quote Originally Posted by pin
    I really hope the new digital entrants start offering decent savings interest rates, but unlikely.
    If they do offer rates meaningfully higher than what the traditional banks offer, presumably that suggests they are higher risk? Also, if they do, wouldn't the traditional banks just respond in kind if they were losing too big a chunk of their deposit base?

  6. #36

    Join Date
    Oct 2006
    Location
    Hong Kong
    Posts
    13,418
    Quote Originally Posted by traineeinvestor
    If they do offer rates meaningfully higher than what the traditional banks offer, presumably that suggests they are higher risk? Also, if they do, wouldn't the traditional banks just respond in kind if they were losing too big a chunk of their deposit base?
    No not really, because they are digital banks they have less overheads. Also they may be willing to sacrifice higher profits / margins for getting market share. Just look at all the digital only banks in NA and Europe, which all offer better interest rates than traditional banks.

    Also if traditional banks offer in kind, isn't that good?
    traineeinvestor likes this.

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