Special Report – Learning FinTech beyond Hong Kong

The technological sector associated with finance needs to advance further in Macau, but it should not be dependent on what happens in the neighbouring Special Administrative Region.

MB April 2021 Special Report | Financial Hub in the making


It is a very common mistake to confuse the entire technological sector associated with finance (the so-called Fintech) with cryptocurrencies and blockchain. And this confusion, often seen in Macau, has slowed the development of the sector – for example, compared to Hong Kong.

“Scandals and scams connected to these technologies have led the Macau gaming regulators to be very sceptical of their use in the city and to take a wait and see approach towards them,” announced a news item from our sister publication Macau News Agency, regarding the last iGaming Asia Congress.

The truth is, following some scams involving alleged cryptocurrency gaming related projects, the Monetary Authority of Macau issued warnings for residents to take precautions when investing in cryptocurrency projects, which it considers prone to fraud, or even use for illegal activities.

Cryptocurrencies and blockchains are therefore not on the first horizon. Much more because, as the AMCM tells Macau Business, “virtual currencies are virtual commodities which are neither legal tender nor financial instruments, and hence, are not subject to supervision of the AMCM.”

The Local Monetary Authority reiterates: “considering that transactions of virtual commodities involve risks, the AMCM has repeatedly reminded the public to pay attention and remain vigilant, and has required all banks and payment services institutions not to participate in or provide any financial services that involve the use of virtual currencies or virtual commodities as the means of payment.”

But the FinTech sector is not limited to cryptocurrencies and blockchains, stresses Professor Adrian Cheung, City University of Macau. “It also includes cloud technology, big data, data centres, payment systems, etc.” Jacky So, Macau University of Science and Technology, agrees: “A Financial Centre must have all kind of financial products and services. After the stock exchange, FinTech will naturally appear, just like what is happening in Hong Kong. Without the financial activities and elements, beside banking, FinTech cannot grow up by itself or cannot take advantages of the synergy and related benefits from the economy of scale.”

Hong Kong, with its eight virtual banks already authorized (only two in Macau, Ant Bank Macau and Macau Development Bank) appears as a reference. But it should not be seen as a model. Or at least as the single model, warns Professor Rose Lai, University of Macau: “Why Hong Kong? China Big Techs are very good at FinTech too. Macau can learn from many good examples. Hong Kong is a good example, but not necessarily a benchmark because of the big difference in the scale of the financial market, and the nature of the economy development.”


“Why Hong Kong? China Big Techs are very good at FinTech too. Macau can learn from many good examples” – Rose Lai.

“As an international financial centre, Hong Kong has more than enough reasons to advance their FinTech. But it does not mean that there is no room for Macau to develop FinTech,” states Adrian Cheung to Macau Business.

The Professor of Finance and Dean of Faculty of Finance, CityU, says that “data storage/transmission centres and payment methods are good examples where Macau may have strategic advantages over Hong Kong.” This is very important to Macau’s economy, given nearly 90 per cent of Chinese consumers use FinTech to pay for almost everything in their daily lives while most small and medium-sized enterprises use FinTech to run their businesses in a cost-effective manner, according to the “China FinTech Report 2020”, released by South China Morning Post. China is the largest FinTech market in the world and the world’s biggest market for mobile payments globally.

So, Adrian Cheung maintains, “using Hong Kong as a benchmark may be misleading, unless Macau is determined to be another international financial centre. A proper way to move forward is to understand the strategic advantages of Macau in the Greater Bay Area.”

In any case, what Hong Kong is doing in this area should not be ignored, understands Oriol Caudevilla, a FinTech advisor and researcher from Hong Kong. “Not only has Hong Kong already become a FinTech hub; it is already preparing itself for the next era of FinTech and smart banking through the four main initiatives disclosed by the Hong Kong Monetary Authority” during the Hong Kong FinTech Week, last November.

[In recent years, AMCM has issued supervisory guidelines including the “Guideline on Risk Management of Electronic Banking”, “Guideline on Cyber Resilience”, “Guideline on Business Continuity Management” and “Anti-Money Laundering and Combating the Financing of Terrorism Guideline”. “The AMCM will revise the relevant supervisory guidelines in a timely manner to keep abreast of the dynamic development of FinTech, with an aim to continually enhance the supervisory requirements,” the Monetary Authority told Macau Business]


In local universities

At the end of February, registration for the new Master of Science in Financial Technology (FinTech) Programme ended at University of Macau.

The lesson plan covers artificial intelligence, blockchain, digital money and electronic payment, big data processing and analysis, and portfolio management, among other topics.

Also very recent is the Macau Institute of FinTech Innovation, created by MUST.

It consists of The Macau Blockchain Application Research Institute, the FinTech Innovation Centre, Macau Research Centre for Finance Innovation Research, and Macau Centre for Legal and Financial Research.

According to the University, “it is established to strengthen the theoretical research and applied research of financial technology, promote the rapid and healthy development of the characteristic financial industry, and facilitate the appropriate diversification of the Macau economy and the construction of the Greater Bay Area.”


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