According to reports, the digital bank known as ZA Bank, which facilitates cryptocurrency trading, might establish brick-and-mortar locations in Hong Kong due to recent changes in HKMA regulations.
It’s been reported by the South China Morning Post that digital banks based in Hong Kong are considering the option of establishing traditional brick-and-mortar branches due to recent regulations permitting them to do so.
Based on the findings, it appears that WeLab Bank, Mox Bank, and cryptocurrency-oriented ZA Bank are contemplating the establishment of brick-and-mortar outlets. A recent ruling by the Hong Kong Monetary Authority allows digital banks to manage a restricted number of physical branches.
In the heart of the city, the leading digital bank, known as ZA Bank, has endorsed the establishment of brick-and-mortar branches. A representative from the bank explained to South China Morning Post that in-person interactions would significantly improve customer service and enable them to tackle intricate problems more effectively.
The action was taken following a request from Hong Kong legislator, Johnny Ng Kit-chong, who urged an increase in aid for cryptocurrency companies within the city, particularly since web3 startups are facing difficulties in securing financial services.
Cryptocurrency businesses established in Hong Kong have encountered challenges when trying to open bank accounts because of stringent regulations and the conservative approach of traditional banking institutions towards cryptocurrencies. A report from the HKMA revealed that out of more than 120 web3 companies founded in Hong Kong last year, approximately 95% experienced difficulties in securing accounts with virtual banks.
Furthermore, about 70% of these companies were required to arrange for shareholders or directors to make multiple trips to Hong Kong, around 60% needed to keep fixed deposits, and approximately 54% ended up opening their accounts after more than six months. Close to 20% managed to open their accounts within a span of two to five months, while about 3% were declined outright.
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2025-01-13 14:51