HONG KONG—Hong Kong is calling on commercial banks to “play nice” with virtual asset service providers (VASPs) as the city-state continues to position itself as a top global digital asset destination, according to a new report.
In a blog post, the Hong Kong Monetary Authority (HKMA) called on banks to embrace new opportunities, including digital assets, as the state’s economy recovers from the pandemic.
According to CoinGeek, HKMA has been in active discussions with commercial banks about the budding digital asset sector “and reminded them that there is no legal and regulatory requirement prohibiting banks in Hong Kong from providing banking services to virtual assets (VA) related entities.”
The report further stated that the central bank has said some VASPs have approached it with complaints about the difficulty of opening a bank account in the state. “They said that some banks have used anti-money laundering concerns to deny them services, while others said VASPs have higher perceived risks,” CoinGeek stated.
Risk-Based Approach
Hong Kong banks must “adhere to a ‘risk-based approach’ when conducting customer due diligence (CDD) and avoid unnecessary processes, and refrain from adopting a ‘one-size-fits-all’ approach to reject account opening applications,” HKMA said.
In adopting a risk-based approach, banks must judge every customer’s needs and risk profile independently, HKMA pointed out. Procedures and requirements for opening an account must be “transparent, reasonable and efficient.”
A First in Platforms
Meanwhile, London-based Checkout.com has become the first global payments platform to receive a Retail Payment Services license from the UAE Central Bank.
According to Fintech Global, the move strengthens Checkout.com’s foothold in the Middle East and North Africa (MENA) region.
The firm’s latest product, resulting from the new license, gives merchants increased control over their payment processing and will enhance Checkout.com’s ability to help brands to expand in the UAE and beyond—a region where 91% of consumers prefer online shopping, the report stated.
“The eCommerce landscape in the UAE is set for major growth, with expectations to hit a Compound Annual Growth Rate (CAGR) of 11%, increasing the market size to $17 billion by 2025.
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