- On 25 August 2016, the Hong Kong Monetary Authority (HK.MA) announced a first round of five successful Stored Value Facilities (SVF) licences under the Payment Systems and Stored Value Facilities Ordinance (the Ordinance).
- The Ordinance commenced operation on 13 November 2015 with a one year transition period allowing existing SVF issuers to apply for licences.
- Upon the expiry of this one year period, i.e. from 13 November 2016 onwards, it will be unlawful for any person to issue or operate a SVF in Hong Kong without a licence (or the benefit of an exemption).
- The HKMA has issued an Explanatory Note on Licensing for Stored Value Facilities, which sets out the scope of the licensing regime as well as
licensing criteria and particulars of the licensing process.
-Apart from the general and high level supervisory principles and approach summarised by the HKMA, applicants are expected to satisfy certain specific practical regulatory expectations of the HKMA in the course of the application process, including that:
- the principal business of an SVF licensee must be the issue or the facilitation of the issue of a SVF, and the licensee is not allowed to carry on any money lending services, financial intermediation activities or any other regulated activities; and
- an SVF licensee must either have paid-up capital of no less than HK$25 million (or an equivalent amount in any other currency) or other financial resources that are equivalent to or exceed this amount.
-The new SVF regime marks the turning of a new page in the development of retail payments in Hong Kong, and is an important milestone in Hong Kong's advance as a fintech hub.
More information on the SVF regime can be found here.