Following is the speech by the Financial Secretary, Mr Paul Chan, at the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2):
Distinguished guests, ladies and gentlemen,
Good morning. It is a pleasure to join you at Hong Kong FinTech Week.
This morning, you have discussed how data, tokenisation and artificial intelligence (AI) are reshaping finance, and why trust matters as we embrace innovation.
Hong Kong has long been at the forefront of fintech. Our task now is to build on that foundation, turning technological capabilities into real economic benefits, particularly in the age of AI.
Several questions stand out. How can payment systems connect more closely? Once assets are tokenised, how do we build scale and liquidity? And when AI starts carrying out financial tasks on our behalf, where should responsibility lie?
The answers matter to Hong Kong's future. This year marks the beginning of the National 15th Five-Year period. Hong Kong's very first Five-Year Plan has also been published, with fintech an important part of our vision.
I see three priorities for our next steps: efficiency as the engine, inclusion as the purpose, and trust as the foundation.
Efficiency as the engine
First, efficiency. The greatest gains increasingly come from connecting financial systems, not simply making each one faster.
Take payments for example. A World Bank survey last year found that the average cost of sending US$200 was about 4.6 per cent through digital remittance services, compared to 7.3 per cent through non-digital services. Behind this cost gap is an infrastructure gap. Here in Hong Kong, our Faster Payment System, or FPS, shows our infrastructure can bridge the gap. It has recorded more than 22 million registrations in a city of 7.5 million people. Last year, daily Hong Kong dollar payments averaged HK$16.2 billion.
FPS already connects with the Mainland and Thailand. Our forthcoming collaboration with UnionPay International will enable QR-code payments at over 100 million merchants across Hong Kong, the Mainland and more than 40 overseas markets.
Users can pay in more places through a familiar service, while businesses can accept cross-border payments more easily.
Connecting digital assets with digital money brings similar benefits to capital markets. In 2023, we issued our first tokenised government green bond, with settlement taking just one business day rather than the five days required under the conventional approach. This September, our fourth digital green bond offering raised around HK$20 billion across four currencies. Tokenised deposits were used in settling the Hong Kong dollar portion.
If we demonstrated speed in 2023, this year, we demonstrate scale: tokenisation can now support mainstream market issuance.
Meanwhile, last week, two tokenised money market funds authorised by SFC (Securities and Futures Commission) began round-the-clock trading on a licensed platform, with safeguards for pricing, liquidity and disclosure. Investors now have greater flexibility in when they trade.
Connecting tokenisation initiatives is the HKMA's (Hong Kong Monetary Authority) Project Ensemble. The project has entered a new phase: banks will be able to settle tokenised deposits around the clock and use them for cross-border payments. The HKMA is also testing tokenised Exchange Fund Bills and working with Cyberport to help businesses explore and test practical applications of tokenisation.
Inclusion as a purpose
Beyond efficiency comes inclusion. However good our infrastructure, if SMEs (small and medium-sized enterprises) still cannot obtain finance, the gains in efficiency will benefit only a few.
Imagine a trading company with reliable customers and a strong record of fulfilling orders, but no property to pledge. Under collateral-based lending, it may struggle to secure a loan. Millions of businesses across Asia face this challenge. A survey by the Asian Development Bank last year estimated that the unmet demand for trade finance worldwide stood at US$2.5 trillion.
Hong Kong's response is to let business data speak where collateral falls short. Since its launch in 2022, the Commercial Data Interchange, or CDI, has facilitated more than 125 000 SME loan applications, involving nearly HK$110 billion in credit.
Research found that banks making greater use of CDI tended to offer SMEs lending rates around 36 basis points lower. This suggests that better data can reduce the cost of assessing a business and help lower its borrowing costs. That is fintech's tangible value.
The same approach is extending to trade finance. CargoX uses cargo and trade data to help banks verify transactions, with 21 banks participating in its pilot.
Through CargoX Connect, five pilot banks can access trade declaration data from the Yangtze River Delta. By early October, this had helped secure approval for trade finance loans totalling HK$180 million.
Last month, the HKMA signed an agreement with the PAA Digital Trade Alliance to extend cross-border data sharing through its network spanning 15 economies.
These initiatives help banks look beyond collateral to understand business performance. When data flows across borders, SMEs can use their track records to seek finance beyond their home economies. Connecting systems help banks recognise businesses they might otherwise overlook.
Trust as the foundation
Ladies and gentlemen, both efficiency and inclusion depend on trust. That trust is supported by sound institutions and earned over time. Hong Kong's regulatory framework has kept pace with innovation to ensure that our financial markets can grow on a firm foundation.
The industry's concerns are practical. Liquidity in secondary trading of tokenised assets is still being built. Large-scale uses of stablecoins are still being tested. Responsibilities for AI agents are still being clarified. Our regulatory framework provides clear rules so that firms can explore these issues with confidence and move forward steadily.
Stablecoins are a good example. When the HKMA granted its first two issuer licences in April, the assessment focused on risk-management experience, commitment to compliance, and genuine use cases supported by viable business plans. Issuers must do far more than issue tokens. They must manage reserves properly, honour redemption commitments and protect users' interests. Robust standards provide the strongest foundation for long-term growth.
The same principle extends to artificial intelligence. The HKMA has just launched Project SAGE (Securing Agentic Finance with Governance and Enablement), bringing together industry experts to explore practical applications of agentic finance and the safeguards they require. It will seek views on how institutions should oversee AI agents: how to keep them within their authority, maintain human control and stop them if something goes wrong. These are questions the industry must address together.
One principle is clear: AI agents may carry out tasks, but responsibility remains with the institution. Those deploying AI must be accountable for its actions. Upholding that principle will allow AI to play a greater, trusted role in financial services.
Bringing benefits into daily business
Ladies and gentlemen, these three priorities serve one purpose.
Imagine a small business receiving payment through FPS in the morning, securing finance using its trade records at midday, and paying an overseas supplier that afternoon. Each step is fast, reliable and safeguarded. That is fintech serving the real economy.
This is how we take fintech further: not simply by launching more pilots, but by bringing their benefits into the daily operations of businesses.
The Government will provide clear rules and reliable infrastructure. I invite you to bring practical applications to Hong Kong.
Together, let us put innovation to work for businesses and for people.
Thank you.