Hong Kong pushes AI adoption in finance with new regulatory frameworks
Hong Kong is advancing AI integration across banking, securities and insurance sectors with new regulatory frameworks, including the HKMA's 'ART' framework and a generative AI sandbox. The government aims to balance innovation with risk management as part of its five-year plan to strengthen the city
Hong Kong is accelerating the adoption of artificial intelligence across its financial sector, with regulators rolling out new frameworks to support responsible innovation while managing systemic risks, the acting Secretary for Financial Services and the Treasury said on 30 October.
Speaking at the Hong Kong Securities Association's 47th-anniversary Financial Innovation Forum, the acting secretary outlined how the government and regulators are pushing AI use in banking, securities, insurance and mandatory provident funds. The Hong Kong Monetary Authority this month published its 'ART' framework, which promotes accountability, resilience and trust in AI-powered banking. The Insurance Authority launched an AI promotion scheme last year that has attracted 10 major insurers.
The Securities and Futures Commission issued a circular in June warning licensed firms about cybersecurity risks from advanced AI models and is collaborating with tech firms on regulatory technology. The HKMA, SFC, Insurance Authority, Mandatory Provident Fund Schemes Authority and Cyberport have jointly launched a 'Generative AI Sandbox++' that has invited 36 use cases from 30 financial institutions and 27 technology partners, covering banking, securities, asset management, insurance and stored-value facilities.
The government is also building a regulated Web3 and digital-asset ecosystem. The Stablecoin Ordinance has taken effect, and the HKMA has licensed two bank-backed institutions to issue regulated stablecoins. Under the Hong Kong Digital Asset Development Policy Statement 2.0, the government will introduce a licensing regime for virtual-asset trading, custody, advisory and management services, and plans to submit an amendment bill to the Legislative Council within 2026.
Chief Executive John Lee's five-year plan, released last month, identifies finance as Hong Kong's fundamental strength. The city ranked third globally and first in Asia in the latest Global Financial Centres Index, with a top ranking in financial technology. The acting secretary said Hong Kong will leverage its role as a 'super connector' and 'super value-adder' to deepen integration between financial services and the real economy, guided by the principle of 'stability seeking progress, progress consolidating stability'.