Financial Secretary Highlights Hong Kong's Vision for AI and Tokenisation at Hong Kong FinTech Week x StartmeupHK 2026

Speech by FS at Hong Kong FinTech Week x StartmeupHK 2026

Following is the speech by the Financial Secretary, Mr Paul Chan, at the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2):

The Financial Secretary, Mr Paul Chan. Photo source: reference image

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.

Photo source: reference image

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.

Photo source: reference image

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.

The Financial Secretary, Mr Paul Chan, attended the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2). Photo shows Mr Chan (front row, fifth right), with other guests at the event. Looking on is the Director-General of Investment Promotion, Ms Alpha Lau (front row, second left). Source: HKSAR Government Press Releases

The Financial Secretary, Mr Paul Chan, attended the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2). Photo shows Mr Chan (front row, sixth left), with other guests at the event. Looking on is the Director-General of Investment Promotion, Ms Alpha Lau (front row, third right). Source: HKSAR Government Press Releases

The Financial Secretary, Mr Paul Chan, attended at the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2). Photo shows Mr Chan (front row, first left) touring at the event. Source: HKSAR Government Press Releases

The Financial Secretary, Mr Paul Chan, attended the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2). Photo shows Mr Chan (centre), with other guests at the event. Looking on is the Director-General of Investment Promotion, Ms Alpha Lau (fourth left). Source: HKSAR Government Press Releases

The Financial Secretary, Mr Paul Chan, speaks at the Hong Kong FinTech Week x StartmeupHK 2026 today (November 2). Source: HKSAR Government Press Releases

Hong Kong FinTech Week 2026

The following is issued on behalf of the Hong Kong Monetary Authority:

The Hong Kong Monetary Authority (HKMA) today (November 2) co-organised the Hong Kong FinTech Week 2026 with Invest Hong Kong. The 11th edition of this flagship fintech event has brought together participants worldwide to exchange insights, showcase innovation, and foster strategic business partnerships.

Following the announcement of "Fintech 2030" last year, the HKMA has built significant momentum in advancing the four strategic pillars under the "DART" framework (Data and Payment, AI, Resilience and Tokenisation). During FinTech Week, the HKMA announced new initiatives across the following four categories, aiming to further strengthen Hong Kong's fintech capabilities and deliver direct benefits to corporations and individuals:

(1) Application and governance of Agentic Finance: As Agentic A.I. technologies continue to mature, they have the potential to reshape how financial services are delivered and used. To ensure responsible development of these services, the HKMA launched Project SAGE (Securing Agentic Finance with Governance and Enablement). The Project will seek to enable the industry to explore and advance agentic finance applications, while ensuring a commensurate governance framework. To support the work of Project SAGE, the HKMA has established a cross-sectoral Agentic Finance Expert Group. Concurrently, the HKMA published a discussion paper on the use of Agentic A.I. by banks, seeking industry feedback on the supervisory considerations pertaining to the governance of such applications.

(2) Driving readiness for post-quantum cryptography (PQC): Quantum computing could in future compromise widely used encryption that protects customer data and transactions. To support the banking sector's transition to PQC in the quantum era, the HKMA and the Hong Kong University of Science and Technology, with support from industry participants, launched the PQC Toolkit. The Toolkit sets out a structured and comprehensive framework with a suite of practical tools to guide banks through their PQC transition journeys. The Toolkit will continue to evolve through industry application, validation and feedback as PQC standards and implementation practices mature.

(3) Accelerating 24x7 settlement of tokenised transactions under Project Ensemble: The HKMA has advanced EnsembleTX to a new stage, enabling 24x7 real-value transactions. This enhancement empowers banks and their clients to unlock new business opportunities, such as dynamic global allocation of funds, effective management of tokenised asset portfolios, and optimised treasury management. The HKMA has also completed trial trades involving Recognised Dealers conducting secondary market transactions of tokenised Exchange Fund Bills, enabling them to enhance efficiency in secondary and repo trading. The HKMA will soon expand the trials to include regulated stablecoins.

In partnership with Cyberport, the HKMA launched tConnect Launchpad to bring together financial institutions, technology firms, and digital asset innovators. This initiative will explore and validate pioneering use cases,accelerating tokenisation adoption in Hong Kong.

(4) Expanding cross-border payment connectivity: The Faster Payment System (FPS) will link with UnionPay International (UPI) by the end of this year, progressively enabling users to pay by scanning QR codes at over 100 million merchants under UnionPay and its partner networks in Hong Kong, the Chinese Mainland and more than 40 overseas markets, for greater convenience in retail payments both locally and while travelling.

The Chief Executive of the HKMA, Mr Eddie Yue,said, "Hong Kong is well placed to capitalise on new growth opportunities in fintech. Building on the good progress that we have made under 'Fintech 2030', banks and fintech firms can better harness data, AI, tokenisation and other emerging technologies. Looking ahead, we will continue to foster an enabling environment that advances responsible innovation, enhances resilience, and supports the sustainable development of the fintech ecosystem."

Source: AI-found images