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HSBC Launches Digital Wallet in HK, Eyes Virtual Bank License for GBA
With Tencent and Alibaba encroaching on its most lucrative market, HSBC pushes back with a startup-aimed digital wallet of its own, the Financial Times reports.
HSBC’s PayMe e-wallet has been around since 2017 but the company has quietly launched a new version designed for start-ups and small businesses. Stuart Tait, regional head of commercial banking for HSBC in Asia Pacific, told the FT that while they “never really thought of it as a client acquisition tool in the [small and medium-sized businesses] space,” the bank has received “thousands of applications” since the April launch.
One big draw for start-ups is PayMe’s 1.5 million-strong user base in Hong Kong. Data from these users are invaluable for estimating potential demand, and HSBC has promised to make the data available to the businesses that have applied.
HSBC’s move comes just as tech behemoths begin to chip away at the banking sector’s profits. Chinese internet giants Alibaba and Tencent, for instance, has been making serious inroads in Hong Kong through their fintech units. Both even won a virtual banking license from the HKMA.
Expanding PayMe could bolster the bank against these attacks, but it currently has no plans on tackling them in the virtual banking space:
Virtual banking services are only available to people and businesses resident in Hong Kong, meaning they provide nothing HSBC can’t already offer customers, said Kevin Martin, HSBC’s head of retail banking and wealth management for Asia-Pacific.
It may reconsider however, should things shape up nicely in the Greater Bay Area:
“Setting up doesn’t make sense right now,” he said. “It may do if the regulations change or if GBA happens in a certain way. We are keeping a close eye on it.”