Hong Kong fintech start-ups seek funding support to beat slump triggered by coronavirus and social unrest

Fallout from coronavirus and social unrest has pushed fintech start-ups to trim headcounts, halt research and innovation

Fintech association has asked government to speed up financial aid and waive other measures in current downturn

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Hong Kong’s fintech start-ups are calling on the government to ease funding eligibility criteria and approval process to give the industry a financial lifeline to beat the economic slump. Photo: Shutterstock Image

Published: 9:30am, 9 Mar 2020Updated: 9:30am, 9 Mar 2020

Financial technology start-ups are lobbying the Hong Kong government to speed up funding approval process to help the industry overcome the coronavirus outbreak and social unrest, both of which are choking their cash flow and research efforts.

The fintech Association of Hong Kong, which represents 350 industry players, wants authorities to ease the funding eligibility criteria for three programmes, as well as quicken the approval process to one month from current three to six months, chairman Henri Arslanian said.

“The social unrest, combined with the coronavirus more recently, has put unprecedented challenge to the most vulnerable members of the community,” he said. “Early-stage, smaller fintech start-ups are particularly vulnerable, as venture investors are more ready to finance larger firms in current circumstances.”

Henri Arslanian, chairman of fintech Association of Hong Kong. Photo: Xiaomei Chen

Like most businesses, the city’s fintech start-ups that rely on selling their solutions in the Chinese market are facing a survival shock. The viral outbreak since January has deepened the slowdown in the world’s second largest economy, and threatened Hong Kong’s ability to rebound from a recession.

The association last week wrote to James Lau, secretary for financial services and the treasury, to relax the funding criteria on two programmes under the Innovation and Technology Fund, and one under the Hong Kong Productivity Council, that support private sector R&D efforts.