The HKU FinTech Index Collection Challenge revealed the second-year Hong Kong FinTech Development Index (FGI) and the 2020Q1 Hong Kong FinTech Buzz Index (FBI) to gauge native FinTech firms’ outlook and the overall sentiment on the sector as reported by the native press.
Hong Kong FinTech Development Index 2020
The FGI represents responses to an annual survey by 27 firms, 11 lower than final 12 months.
The Hong Kong FGI for the monetary 12 months 2019-20 is 120.9, up 20.9 index factors from 2018-19. The FGI anticipated for the monetary 12 months 2020-21 is 133.6, a rise of 12.7 index factors (or 10.5%), representing a optimistic outlook for Fintech growth in Hong Kong within the coming 12 months regardless of the influence from the anti-extradition invoice protests and COVID-19 outbreak.
Of the 4 sub-indices (Desk 1), the Enterprise Setting sub-index, measured by each inner and exterior elements on FinTech enterprise operations and growth, is 105.8, 5.8% greater than 2018-19. The sub-index is predicted to extend by 9% to 115.Eight in 2020-21, attributing to enchancment in exterior elements together with extra funding alternatives and a safer and extra steady funding atmosphere within the coming 12 months.
The Enterprise Efficiency sub-index, measured by FinTech buyer adoption charge and income, is 143.4, 43.4% greater than 2018-19, and is predicted to extend by 28.4% to 184.1 in 2020-21, representing a optimistic outlook in enterprise growth by the FinTech trade. Of the responded firms, 70.4% talked about abilities acquisition as the primary problem in enterprise operation which has grow to be harder.
The Funding on R&D or Product Growth sub-index is 126.6 for 2019-20, 26.6% greater than 2018-19 and is predicted to drop by 2% to 124.1 in 2020-21. The downturn may be attributed to FinTech firms reducing their funding on R&D or product growth. In 2019-20, FinTech firms primarily spent their R&D or product growth expenditure on Buyer expertise (59.3%), AI, large knowledge and machines/deep studying (44.4%) and Cellular options (33.3%).
The Calls for on Abilities sub-index is 107.9, 7.9% greater than 2018-19 and is predicted to extend by 3% to 110.6 in 2020-21. The anticipated development charge is decrease than sub-indices Enterprise Setting and Efficiency which signifies that firms are turning conservative in hiring abilities as a result of draw back income danger. On the required abilities for brand new workers, programming abilities (85.2%) are essentially the most preferable abilities for brand new hires, adopted by advertising experience (48.1%). IT infrastructure abilities (42.1%) have advanced to be a extra necessary talent set than in 2018-19.
Hong Kong FinTech Buzz Index – 2020Q1
Round 1000 information articles within the first three months from January to March 2020 had been analysed. Hong Kong FBI for the primary quarter (Q1) of 2020 is 100.3, a drop of 1 index level (or 0.98%) from 101.Three within the final quarter of 2019 (2019This autumn). The YoY change drops by 3.5 index factors, or a 3.37% lower from 103.Eight in 2019Q1, persevering with a downward pattern from the height in 2019Q2.
Indices of the six subsectors present totally different adjustments (Desk 2), with will increase recorded in three sub-indices: Insurance coverage Know-how (InsurTech), Wealth Know-how and Credit score Know-how (WealthTech & CreditTech), and Regulatory Know-how (RegTech) & Cybersecurity. Optimistic information in InsurTech had been associated to banks in Hong Kong switching to advertise on-line insurance coverage underneath COVID-19 which has facilitated the expansion of associated expertise. Furthermore, the launching of digital banks has proved the profitable use of sandbox to make sure cybersecurity, therefore leading to optimistic information in RegTech & Cybersecurity in addition to WealthTech & CreditTech.
The explanations underlying the general drop in FBI for 2019-20 are difficult. Hong Kong has skilled the outbreak of Covid-19 through the interval, some FinTech firms may need been closed quickly to introduce social-distancing, this may result in a slowing within the tempo of economic expertise growth.
In regards to the HKU FinTech Index Collection Challenge
The HKU FinTech Index Collection Challenge introduces the Hong Kong FinTech Development Index (FGI) and the Hong Kong FinTech Buzz Index (FBI) to gauge native FinTech firms’ outlook on the trade and the overall sentiment on the sector as reported by native press. It’s the first within the area to supply index indicators on the event of the sector, with an goal to supply data in a well timed method to trace the expansion and growth of the monetary expertise trade in Hong Kong.
FGI is a yearly index with 4 sub-indices on Enterprise Setting, Enterprise Efficiency, Funding on R&D and Demand on Expertise. It displays Hong Kong FinTech sector’s forecast of the market scenario within the coming 12 months and an evaluation of the scenario within the present 12 months. FBI is a quarterly index representing a quantified sentiment of the native FinTech-related information articles in Chinese language up to now three months. The index has a base value of 100 factors which represents the sentiment of almost 10Okay FinTech associated information articles in main native information media shops in 2016 and 2017. FBI is additional damaged down into six sectors: Insurance coverage Know-how (InsurTech), Wealth Administration and Credit score Know-how (WealthTech & CreditTech), Blockchain & Cryptocurrency, E-Fee & Digital Banking, Regulatory Know-how (RegTech) & Cybersecurity and different associated enterprise together with AI and large knowledge.
The mission was initiated by the expertise switch firm of the College – Versitech Restricted, and is led by Dr Philip Yu of the Division of Statistics and Actuarial Science of the School of Science. The five-year mission is sponsored by Suoxinda Knowledge Know-how Co. Ltd headquartered in Shenzhen.
About HKU FinTech Index Advisory Board
The Advisory Board contains professionals from the College of Hong Kong and the native FinTech trade, together with representatives from FinTech Affiliation of Hong Kong, InvestHK, Cyberport, Hong Kong Science and Know-how Parks Company, The Bank of East Asia, Restricted, and Suoxinda Knowledge Know-how Co. Ltd. The members present professional recommendation on the FinTech firms to be included within the grasp checklist for the annual survey to return the FinTech Development Index. In addition they advise the Challenge on index methodology.
