A street food vending cart in Hong Kong accepts Alipay, WeChat Pay, Octopus and other payment methods. (Photo/Xinhua)
"With a backward underlying payment system that essentially makes Hong Kong belie its crown as the world-renowned financial hub, any front-end payment technologies cannot be truly given to the full play," Chan reasoned. "No wonder digital payment, which takes many parts of the world by storm within just a few short years, could hardly catch on in Hong Kong."
In a sign of its determination to recover some "lost ground", the city's de facto central bank made the much-awaited move to launch a real-time retail payment system in September last year.
The service, officially called Faster Payment System, or FPS, enables instant or near-instant retail payments, settlement and fund transfers between banks and non-banks.
HKMA Chief Executive Norman Chan Tak-lam believed the system should be the "world-leading" one as it goes the extra mile to connect the city's licensed third-party payment service providers together. Such connectivity could barely be seen between Alipay and WeChat Pay on the Chinese mainland, at least for the time being.
"One of the issues we face today is users and merchants are very often on different payment platforms," said Gary Ng, risk assurance partner at PricewaterhouseCoopers Hong Kong, who anchored high hope on the upcoming payment system.
"The new payment system can solve this problem as it integrates all banks and SVF operators such that their account holders can transfer money between different platforms on an almost real time basis," Ng noted. "It will also come with a common QR code standard, which would promote the wider use of mobile retail payments and greater convenience to customers and merchants."
"The system itself is better than nothing, but far from enough, as early movers like the Chinese mainland, Singapore and the European Union have already rolled out the likes of FPS a couple of years ago," Chan said. "When we cheer for the FPS finally getting off the ground in Hong Kong, the next big things－blockchain technology, for instance－are well underway. We are always one step behind."
"Hong Kong may be late. But we have not missed the boat yet," said Hung, who believed the local payment market, technologically ready for a game-changing moment, calls for a "booster" to fire the first shot.
In a business world where winner takes all, late movers may have no more than five years left to play catch-up in the payment turf war. But if Hong Kong cannot confirm its competitive edge within the coming one or two years, it would be left well behind forever, Hung warned.
A teeming city of 7 million people, Hong Kong is anything but a market where digital payment operators could easily survive and thrive. There is no shortage of local e-payment platforms emerging as a fleeting show. Under the overwhelming dominance of the Octopus card and credit cards, very few will likely manage to fight their way into successful niche businesses, Hung added.
TNG, a Hong Kong-based digital wallet operator founded in 2013, finally gained a firm foothold by offering global money transfers, foreign-exchange transactions and bill payments, after a bout of failed partnerships with local merchants and public transportation operators.
The company polished its brand as "Hongkongers' e-wallet". But it turns out to be city's foreign domestic helpers, and underbanked or unbanked individuals in developing countries without access to banking services, who shore up its business at home and abroad.
