“That’s all because of the investment we made in digital. Over 90 per cent of our wealth management transactions are already through digital channels.

“Globally, as a bank, we invested US$6.1 billion in digital and technology development last year. In 2022, we released, on average, more than one digital feature enhancement every day for our wealth and personal banking and commercial banking customers in Hong Kong.”

The wisdom of making those investments during the pandemic continues to bear fruit today, both for the bank and its customers. The take-up has been highly successful, while those planning to move to Hong Kong can open an account in just 10 minutes through their mobile phones before they arrive.

Lim points to the high adoption rates of the bank’s digital channels, as shown by the HSBC Mobile app’s more than 2 million active users. The app has a host of features, including free money transfers to HSBC and other bank accounts in over 50 countries and territories, as well as tracking best-performing trading ideas.

In the back office, HSBC has long employed technology, including artificial intelligence (AI), to support customer service, streamline operations and detect financial crimes.

“AI has been around for a long time now. What has changed in the last couple of years is the emergence of generative AI,” Lim says.

She cites customer service chatbots as an example, where instead of having pre-programmed standardised answers, the virtual assistant, enabled by generative AI, can learn about a customer’s own needs.

“It’s going to be like you’re talking to a human; it’s going to be very personalised. It will be a game-changer one day in terms of how we interact with our customers,” she says.

However, Lim says such technology will not fully replace in-person services, and it will also need to be overseen by proper governance and risk management, with the necessary tooling. “There’s a fiduciary duty here, and that lies with the bank.”

For business clients, HSBC is also enhancing its service offerings through technology, especially for small and medium-sized enterprises (SMEs), which Lim calls “the lifeblood of Hong Kong”.

“We’ve launched Merchant Box, a digital solution for SMEs to simplify payments across e-commerce platforms, as well as a B2B [business-to-business] embedded financing tool for business clients to offer extended terms of payments,” she says.

The bank has also participated in industry-wide initiatives that seek to achieve financial inclusion, including the Hong Kong Monetary Authority’s (HKMA) Commercial Data Interchange (CDI).

CDI has been introduced as “a next-generation financial data infrastructure” to enable more efficient financial intermediation in the banking system by introducing a single connecting point for secure, efficient and scalable sharing. The goal is to facilitate the credit assessment process for lending to SMEs.

Another development that could benefit SMEs in the future is the use of digital currencies. For example, under the HKMA’s retail e-HKD pilot programme, HSBC partnered with the School of Business and Management of the Hong Kong University of Science and Technology to conduct an exercise in mid-September, when about 200 students were given 100 hypothetical e-HKD tokens to spend at five on-campus merchants during a one-week period.

“The insights gained from this closed-loop pilot provide an initial picture of the benefits that a Central Bank Digital Currency [CBDC] ecosystem could potentially provide in everyday payments,” Lim says. “Our distributed ledger technology has enabled near-instant transfer of value from customer to merchant wallets, as well as provided automated rewards and discounts using smart contract programmability.”

She adds that while the findings of the trial will serve as a foundation for future retail digital currency experimentation, the business case for a wholesale digital currency is already clear.

Hong Kong is at the forefront of international wholesale CBDC development. Between August 15 and September 23 last year, 20 commercial banks from Hong Kong (including HSBC), mainland China, the United Arab Emirates and Thailand conducted US$22 million worth of transactions on behalf of their corporate clients using the CBDCs issued on a shared platform by their respective central banks.

The initiative, named mBridge, enables rapid business transactions, so that payments between businesses can be settled within seconds – securely and at little cost.

HSBC is a strong supporter of Hong Kong’s start-up ecosystem, home to some 800 fintech companies. In addition to sponsoring various pitch programmes that provide start-ups with the chance to secure seed money and meet venture capitalists, the bank’s US$3 billion HSBC New Economy Fund provides high-growth, innovative companies across Hong Kong and mainland China with tailored debt solutions from Series A funding onwards.

Nurturing future talent is another important factor that underpins the bank’s strategy in supporting fintech, Lim says. HSBC works with several universities to roll out competitions for post-secondary students to showcase their ideas, while providing them with training and networking opportunities that equip them for fintech careers.

All of this comes down to one goal: ensuring the healthy development of financial services.

“As a bank, we use the services of fintech companies. They give us capabilities in very agile ways,” Lim says.

“When fintech start-ups were first emerging, people would say the banks should be afraid. Today, we are at a point where we love each other. It’s a great marriage,” she concludes.

Luanne Lim is among the more than 500 notable speakers at this year’s Hong Kong FinTech Week, which is taking place until November 5 and attracting more than 30,000 attendees from some 95 countries and territories.