Hong Kong’s banking regulator, the Hong Kong Monetary Authority (HKMA), is making Smart Banking dreams come true by rolling out the Open Application Programming Interface (API) Framework for the Hong Kong banking sector and launching its own Open API.
The Open API Framework is one of the seven initiatives announced by the HKMA in September 2017, allowing banks and fintechs to share data efficiently and create innovative services.
During the consultation, the HKMA received 41 responses from banks, technology/fintech firms, industry associations, consulting firms, payment card scheme operators, individuals, and other interested organizations. All respondents were generally positive about HKMA’s Open API Framework, although some needed more details on how to engage with Third Party Service Providers (TSPs).
“Open API is one small step for a bank, but a milestone for financial innovation in the banking sector. We hope that the Framework will provide specific guidance to enable collaboration between banks and TSPs, and ultimately bring new experience of innovative, convenient and safe banking services to customers,” Norman Chan, Chief Executive of the HKMA, said in a press release.
The Framework uses a risk-based principle and a four-phase1 approach to implement various Open API functions. It is based on international technical standards and offers specific expectations of how banks should onboard and maintain relationships with TSPs in a manner that ensures consumer protection.
With the release of the Framework, the HKMA expects banks to deploy Phase I Open APIs within six months and Phase II Open APIs within 12 to 15 months.
HKMA’s own Open API has around 130 sets of information covering all financial data and essential information published on the HKMA's website. It will be made available for Open API by phases.
Fifty sets of financial data and relevant information can already be accessed via the API. The remaining 80 sets of data will be opened via API by phases for completion by mid-2019.
“The HKMA is leading by example through making available a range of financial data and important information on the HKMA's website in Open API format, to facilitate flexible retrieval and application of such information by stakeholders and the general public,” Chan said.