Hong Kong FSIs are taking the lead on AI deployments. But while this shows innovation is alive and well, spurred by the Open Banking initiatives, barriers remain.
According to a global survey released by Finastra, Hong Kong FSIs are more likely to deploy AI than those in Singapore, the U.S. and the U.K. Fifty-eight percent in Hong Kong said they were looking to deploy the technology in the next year, at least 11% higher than any other market surveyed.
Of note is that this research was done before the COVID-19 pandemic. It shows that Hong Kong FSIs were already embracing emerging technologies.
The research also found that 95% of financial institutions in Hong Kong see fintech collaboration as a criterion for success. Open Banking and connecting to third parties through open APIs appears to be speeding up with 89% of Hong Kong respondents either adopted, are adopting or are looking to adopt open APIs in the next 12 months.
Around half of those surveyed (53%) said Open Banking helped them to deliver new services and, therefore, new revenue streams.
“The findings indicate a positive direction of travel for Hong Kong’s banking industry and the levels of service that customers can expect to receive in the future,” said Wissam Khoury, senior vice president and general manager for APAC and MEA at Finastra in a press release.
The biggest challenge is regulatory complexity. Half of Hong Kong respondents cited this as the largest barrier — more than any other country in the survey. Sixty-two percent believed that the government or the industry is not helping to drive innovation.
“In a customer-led, highly competitive market such as Hong Kong, the successful adoption of Open Banking — coupled with greater fintech collaboration and technology innovation — will be key to success for its financial institutions. This makes a supportive regulatory framework all the more important. With the right environment, Hong Kong will continue to be an innovation leader in financial services,” added Wissam.
Photo credit: iStockphoto/yanjf