Australia and Hong Kong’s financial service regulators have penned an agreement which will give fintechs more freedom to expand.
The agreement will allow Australian fintechs hoping to enter Hong Kong a hotline to Hong Kong’s regulator, the Securities and Futures Commission, making it easier to understand the regulations in a foreign country.
The reciprocal will be offered for Hong Kong companies wishing to enter Australia.
“Financial services are a major contributor to Hong Kong's US$316 billion economy. The Cooperation Agreement is a significant boost for Australia's burgeoning fintech sector and will ease entry into this important market for innovative Australian businesses,” said Cathie Armour, commissioner of Australian regulator ASIC.
ASIC and the SFC will also share information on market trends and fintech regulation as part of the deal.
Australia and Hong Kong are top trading partners but what will be gained through a fintech agreement remains unclear.
A recent report by the Bank for International Settlements found that Hong Kong had only one fintech lending company, suggesting there are very few Hong Kong players that could enter Australia and therefore benefit from the agreement.
Mainland China has a vibrant and flourishing fintech scene, but the ASIC agreement is limited to Hong Kong.
Australia has over 20 fintech lenders, but very few operate in Hong Kong.