FCA partners with HKMA to foster financial innovation
Hong Kong's Monetary Authority and the UK's Financial Conduct Authority (FCA) have announced they are partnering to foster innovation in fintech. The regulatory authorities will facilitate innovation in finance through joint projects, information exchange and experience sharing, among other initiatives. The partnership enables FCA-authorised fintech companies to grow overseas and engage non-UK innovators looking to enter FCA-regulated markets. The agreement marks the FCA's fifth international partnership of its kind. Australia, Singapore, South Korea and China have previously signed collaboration agreements with the UK body.

The UK’s Financial Conduct Authority (FCA) has signed a co-operation agreement with the Hong Kong Monetary Authority (HKMA) to foster collaboration between the two regulatory authorities towards the promotion of financial innovation.

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Financial Innovation

As a result of the agreement, the FCA and the HKMA will work together on a number of initiatives such as referrals of innovative firms, joint innovation projects, information Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term and experience sharing, to facilitate financial innovation in the United Kingdom and Hong Kong.

The latest agreement follows several other collaborations that the FCA has instigated with international authorities including Singapore, South Korea, China and Australia, which it signed in March this year, and is part of its statutory objective to make financial services markets work well. Promoting competition through innovation forms a significant part of the regulator's mission.

Commenting on the new agreement, Christopher Woolard, Executive Director of Strategy and Competition at the FCA, said: “Both consumers and the wider UK economy benefit from the transfer of ideas and innovation. The Agreement signed today with the HKMA is a good example of this type of international co-operation and we look forward to working to promote innovation and reduce barriers to entry for firms both here in the UK and in Hong Kong."

Breakdown of Barriers

The agreement will reduce the barriers for authorised firms looking to grow to scale overseas and assist non-UK innovators interested in entering the market that is overseen by the FCA.

As far as Hong Kong is concerned, the agreement is a key initiative of the Fintech Fintech Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Read this Term Facilitation Office (FFO) of the HKMA. It presents significant opportunities for financial and fintech companies to enhance their services and extend their global footprint. The agreement also reflects the HKMA’s commitment to build a vibrant fintech ecosystem.

Shu-Pui Li, Executive Director (Financial Infrastructure) of the HKMA, added: "Collaboration between the HKMA and the FCA will create significant synergy for the two markets by enabling fintech firms and financial institutions to extend their global reach and learn from their foreign counterparts. It will also help to enhance services delivered by financial institutions.”