2014On the afternoon of June 28,，"2014 Cross-Strait and Three Places P2P Online Lending Industry Summit Forum" was held at the Friendship Hall of Shanghai Convention and Exhibition Center。Ms. Zhang Zhengfen, founding partner of Hong Kong P2P platform Bubu Liandai, was invited to attend，And focus on the development status of Hong Kong’s P2P industry、regulatory framework、Market opportunities and platform models were systematically shared。
As a professional organization that has long been concerned about Hong Kong’s financial supervision and Internet financial compliance development，we think，The formation and evolution of Hong Kong’s P2P industry，Must be placed in Hong Kong’s mature financial system、moneylender regulatory regime、Basics of credit reporting and understanding under the rule of law environment。The following content focuses on the core logic of P2P development in Hong Kong。
Hong Kong financial industry regulatory system
Hong Kong’s financial industry can be broadly divided into three main segments。
- Authorized institutions regulated by the Banking Ordinance：banking industry as it is known to the public。There are three levels of accreditation institutions in Hong Kong，Includes licensed banks、Restricted license banks and deposit-taking companies。
- Regulated business subject to the Securities and Futures Ordinance：Covers 9 types of regulated activities，involving stocks、futures、Securities-related transactions such as foreign exchange and various derivatives。
- Money lending business regulated by the Money Lenders Ordinance：This part is most closely related to P2P business。Money lenders in Hong Kong usually refer to legal entities，Only licensed money lenders can engage in money lending business in Hong Kong。
Hong Kong money lender license needs to be reviewed and renewed every year。Only if there are no violations or violations during the operating year，A licensed company with no excessive complaint record，Only then can you have a chance to successfully obtain license renewal.。
In terms of loan interest rates，Hong Kong has clear regulatory boundaries：Annual interest rates below 48% are legal；Annual interest rates above 60% are illegal；The annual interest rate ranges from 48% to 60%，It needs to be judged based on specific cases，and shall be subject to the judge’s decision。
Macroeconomic environment for P2P development in Hong Kong
mentioned Hong Kong，The outside world often suffers from its small geographical area.、Population size is limited，And underestimate the development potential of P2P business。But from the depth of financial markets、From the perspective of residents’ asset allocation needs and loan demand structure，Hong Kong still has a fairly strong foundation for P2P development。
Economic development and investment capital base
Hong Kong's economy is highly developed，Per capita GDP is about 6 times the mainland average。we think，This constitutes an important benefit to the development of the P2P industry。
Judging from the mainland P2P market experience，Many first-line platforms have transferred funds from developed eastern regions to areas with strong capital demand in the west.。for Hong Kong，Its economy is developed、GDP per capita leads，This means that regardless of the number of investors，Or from the perspective of the investment amount that a single investor can invest?，Hong Kong has the potential to become a market as powerful as Beijing, Shanghai, Guangzhou and Shenzhen.。
Low interest rate environment increases investment willingness
Hong Kong bank time deposit interest rates have remained at low levels for a long time。For example，HSBC’s 6-month fixed deposit interest rate is only 0.05%。This level of interest is far from enough to cover the various fees that may be incurred in a bank account。
It can be said clearly，If the account funds are less than HKD 1 million，Funds are placed within the Hong Kong banking system，Actual purchasing power and account value may gradually decline。This low interest rate environment，It also indirectly promoted the active development of Hong Kong’s financial market.。
in Hong Kong，Whether it's a bond、stock、turbine、gold futures、High leverage foreign exchange margin trading，Or lottery and horse racing?，All have mature markets。at the same time，Hong Kong’s savings rate remains at a relatively high level globally。Taken together，The low interest rate environment helps increase investors' attention to alternative income products such as P2P，There are also sufficient funds available for allocation in the market.。
The size of private debt and borrowing needs
Observed from the borrowing side，Hong Kong’s private debt accounts for 60% of GDP，At a similar level to developed European countries。
It should be noted that，The data comes from statistics from central banks of various countries.，However, there are differences in statistical calibers in different regions。Relevant data in Hong Kong only include the loan volume of three types of authorized institutions regulated by the Banking Ordinance，Excludes the loan volume of many finance companies regulated by the Money Lenders Ordinance。In comparison，Loan volumes for other countries cover a wider range of。therefore，Hong Kong’s private debt-to-GDP ratio may actually be higher than 60%。
In private debt classification，Residential loans accounted for 74%，nearly three quarters；Another large use is credit card repayments，8% of total private debt。therefore，Many financial companies provide "card clearing" services，That is to help users repay their credit card debts at lower interest rates，and transfer credit card debt to a finance company。
Since bank credit card overdraft interest is close to 40%，Finance companies assume relevant debts at relatively low interest rates，Forming an important business scenario in Hong Kong’s consumer credit market。overall，Hong Kong’s higher debt structure，Provides a realistic demand basis for the development of P2P lending end。
Hong Kong’s core advantages in developing P2P
Analyzing Hong Kong’s macro GDP level、After the low interest rate environment and high debt scale，We must also focus on Hong Kong’s credit reporting system and legal environment.。These two infrastructures，It is the key for Hong Kong’s P2P industry to establish a trust mechanism and risk control system.。
The credit reporting system is mature and the data is centralized
Compared with the early credit reporting environment in the Mainland，Hong Kong’s credit reporting system is more mature。There is only one recognized credit reporting company in Hong Kong，i.e. TransUnion Information Co., Ltd.。The company operates as a commercial company，It is a for-profit organization，Have considerable data scale，Covers the credit records of 4.7 million consumers。
Everyone can pay to check their credit record。The credit report will list details of changes to personal information.、All past credit records、Repayment time、Public bankruptcy records and other information。Each report comes with a credit score，Ratings are graded in descending order from A to J.。
This credit reporting system has great influence，banking institution、financial institution、Used by merchants, stores and government agencies。Credit scoring significantly improves the efficiency of credit analysis by banks and financial companies，Enable it to complete automated preliminary screening through a scoring mechanism。For the P2P industry in Hong Kong，A complete credit reporting system provides strong risk control support。
The legal environment strengthens lender protection
It has a more basic supporting role than the credit reporting system.，It is Hong Kong’s perfect legal environment。A mature legal system is of great significance to the development of P2P，Especially reflected in property mortgages、Transparency in repossession and auction processes、Enforcement and execution efficiency。
in Hong Kong，Relevant legal procedures are relatively standardized，Higher execution efficiency，Helps effectively protect the legitimate rights and interests of lenders。For lending models based on mortgage assets，This institutional environment is particularly important。
Main challenges for P2P development in Hong Kong
Although Hong Kong has multiple development advantages,，But at that time, there were only two P2P platforms in Hong Kong.，This also shows that the industry still faces certain restrictions。
The foundation of the Internet industry is relatively weak
Hong Kong’s Internet industry after the Internet bubble in early 2000，Affected by capital withdrawal，Development has been relatively slow in the past 10 years。
Although Hong Kong is relatively advanced in Internet infrastructure construction,，Public Wi-Fi hotspots have wide coverage，Unlimited data plans are also quite common，But Hong Kong lacks leading Internet companies，There is no particularly developed e-commerce ecosystem.，There is also a lack of new industries that have emerged based on the in-depth integration of the Internet and traditional industries.，For example, Internet finance。
Internet genes are not strong enough，It is one of the important challenges facing the development of Hong Kong’s P2P industry.。
Money lender license creates compliance threshold
In addition to the basics of the Internet，Regulatory requirements are also an important limiting factor。Hong Kong clearly stipulates，Not holding a money lender’s license，Not allowed to carry on money lending business in Hong Kong。
This threshold is not just the license itself，It will also affect the company's business model、Fund transfer arrangements、Risk control structure and compliance operation path。For P2P platforms，How to design a legal and compliant business model under the framework of the Money Lenders Ordinance，This is an issue that must be carefully resolved before entering the Hong Kong market.。
but，Behind challenges there are often opportunities。P2P in the United States、Europe，Especially in mainland China, they have developed rapidly。Based on Hong Kong’s mature financial system、Legal environment and financial foundation，The Hong Kong market also has the possibility to further explore the Internet financial model。
Comparison of two P2P platform models in Hong Kong
At that time, there were only two P2P platforms in the Hong Kong market.，Represent different business paths and product positioning respectively.。
Welab：Hong Kong’s first P2P platform
Welab was established in August 2013，It is the first P2P platform in Hong Kong。Within 10 months of establishment，Already matched HKD 400 million loan application。
Public information display，Welab adopted a pure credit loan model at that time，The upper limit for each loan is NT$300,000，The approval rate is 15% to 20%。
2014June 16，Welab has acquired shares from institutions including TOM Group (02383-HK) and the American Silicon Valley venture capital firm Sequoia Capital.，Total capital injection of US$14 million，Approximately HK$109 million。
Bubuliandai：China-Hong Kong linked P2P platform
Bubu Liandai is the second P2P platform in Hong Kong，Established in early December 2013，Its business model is quite different from that of Welab。
Welab mainly matches wealthy institutional shareholders with funds and credit loan applicants.；Bubu Liandai mainly matches individual ordinary investors with lenders who own property mortgages in Hong Kong.。
At the business level in Hong Kong，Bubu Liandai will cooperate with established financial companies in Hong Kong to develop business。This type of financial company is similar to mainland small loan companies，Professional organizations are responsible for professional links，The platform focuses on the matching mechanism and platform construction。
at the same time，Bubu Liandai is also developing mainland investment products，Including outstanding small and medium-sized enterprise loan projects guaranteed by financing guarantee companies，Provide Hong Kong investors with more choices。From a product perspective，Bubu Liandai was the only P2P platform in Hong Kong that linked China and Hong Kong.。
Team background and industry vision
The founding team members of Bubu Liandai all graduated from prestigious schools，Have overseas study and work experience，Worked at BNP Paribas、Societe Generale、HSBC、King & Wood Mallesons、Tencent、Yihai Kerry and other Fortune 500 companies and well-known institutions，and through the Hong Kong Talent Introduction Program。
As a team with financial、law、A team with Internet and cross-border business experience，Its development goal is not only to build a P2P matching platform，We also hope to contribute to the prosperity and development of Hong Kong’s Internet finance.。
Enlightenment from the development of P2P compliance in Hong Kong
The development logic of Hong Kong’s P2P industry is clear：on the one hand，low interest rate、high savings、Mature credit reporting、Improving the rule of law and high private debt，Provides the foundation of capital and assets for P2P；on the other hand，moneylenders license、regulatory boundaries、Internet ecology and business model design，It also imposes higher compliance requirements on the platform。
we always think，Carrying out any form of financial lending in Hong Kong、matchmaking、Money lending or cross-border financial business，Companies must prioritize license qualifications、business boundaries、Interest rate compliance、Information disclosure、Key issues such as investor protection and risk control。Only by establishing a robust business model within a compliance framework，Only in this way can we truly gain the long-term trust of the market.。
About Hong Kong Xintong
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