HK paving way for digital yuan use

Eunice Liu

Hong Kong is working on ways to allow mainland tourists to use the digital yuan for retail transactions in city, according to Secretary for Financial Services and the Treasury Christopher Hui Ching-yu.

Hong Kong residents can already use the e-yuan for retail transactions in the mainland, thanks to a link between Octopus and the Bank of China's Shenzhen branch.

Hui said the government is now encouraging Octopus to enable mainland travelers to use the e-yuan in Hong Kong by topping up their Octopus cards, once regulations are approved and the technology is ready.

Further use of the e-yuan in other areas will come in time, depending on technology and the specific situation, Hui said, adding he would go forward one step at a time.

Bank of China Hong Kong will also enhance its e-yuan offerings and user experience in the future, Hui said.

He said the government would continue to support financial institutions and enterprises in exploring the cross-border use of the e-yuan on retail payments and two-way connectivity.

Financial Secretary Paul Chan Mo-po, meanwhile, said Hong Kong is now home to about 1,000 fintech companies and start-ups, up 25 percent from last year, and many of their founders come from different parts of the world.

Among them, virtual banking is growing rapidly with increasing numbers of people and small and medium-sized enterprises using their accounts and services.

The industry is also expanding into the Southeast Asian market, and two virtual banks have been ranked among the top 10 mobile banking applications globally.

Chan said the Commercial Data Interchange has received more than 8,900 loan applications since its launch in October 2022, with an aggregate credit approval amount exceeding HK$8 billion.

The CDI allows companies, especially SMEs, to share their sales, logistics, transaction and other data with banks, making it easier for them to access loans and other financial services.

eunice.liu@singtaonewscorp.com