Banks consulted on cash handout
The Hong Kong Monetary Authority held meetings with the city's main banks on Monday to discuss how to distribute a HK$6,000 cash handout to each permanent resident, people familiar with the matter say.
It has been a week since Financial Secretary John Tsang Chun-wah announced the giveaway to more than six million permanent adult residents. It replaced a scheme to inject the same amount in Mandatory Provident Fund pension accounts.
One senior person at a bank, who requested anonymity, said the government may distribute the money through recipients' bank accounts because of lower costs, but this plan has problems. 'Many people have several bank accounts, and the government will have to cross-check and even contact each person several times,' the person said.
A senior manager at another bank, who also requested anonymity, said apart from operational expenses the bank would probably not charge for distributing the money. The person said no matter how the government decided to distribute the money, banks would have to be involved.
There has been concern over the possibility of banks charging fees to distribute the handouts.
Mark McCombe, HSBC Hong Kong chief executive, said distributing the money through banks would be viable, but it was up to the government to decide the next move and that banks would take a back-seat role.
The Monetary Authority, Hong Kong's de facto central bank, which meets banks regularly, could not comment on specific meetings, said Rhonda Lam, communications chief of the authority's corporate services.
The original budget proposal was to inject HK$6,000 into each of Hong Kong's four million MPF accounts. But Tsang bowed to public pressure after the plan drew widespread criticism for not helping the middle class.
