Abu Dhabi Global Market signs fintech deal with Hong Kong regulator

The Abu Dhabi Global Market has signed a strategic cooperation deal with Hong Kong’s de facto central bank on providing reciprocal support for their developing fintech sectors.

As the global fintech industry continues on its course of mass disruption to traditional banking systems, leading financial centres across the world are scrambling to get ahead of the curve and establish themselves as regional and international hubs for financial technology, with cross-border cooperation between regulatory authorities a necessity for successful development.

In recent times, this has seen a string of announced cooperation agreements between fintech hubs and financial regulators on all points of the globe; the latest being the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Market (ADGM) teaming up with the Hong Kong Monetary Authority (HKMA) to jointly promote fintech innovation and facilitate business expansion opportunities between their home markets.

In addition, the agreement will allow for the increased sharing of information and the potential for project collaboration, including the possible establishment of an international financial trade network based on based on distributed ledger technology (DLT – which digitally records transactions in a decentralised fashion), of which blockchain is the most prominent example.“We are glad to further our partnership and collaboration with HKMA by way of this FinTech agreement,” FSRA Chief Executive Richard Teng said. “We look forward to working closely with the HKMA to support our FinTech start-ups and our innovative businesses, from regulations to adoption, in advancing and applying their solutions to each of our respective financial markets and jurisdictions”.

Nelson Chow, HKMA’s Chief Fintech Officer, responded in turn; “ADGM’s commitment to the pursuit of innovation resonates strongly with Hong Kong’s ambitions. The co-operation between the HKMA and the FSRA would strengthen the two authorities in their respective roles and initiatives in FinTech. We are particularly pleased to start a dialogue with FSRA on the opportunity to build a cross-border trade finance network using distributed ledger technology.”

The latest agreement follows an earlier similar announcement between the ADGM and The Hong Kong Securities and Futures Commission, while the HKMA already has a corresponding deal in place with Dubai Financial Services Authority (DFSA). Altogether, the latest deal is the 11th such statement of cooperation the ADGM has made with ‘like-minded international financial centres and jurisdictions to foster a robust and sustainable global FinTech ecosystem’.

These so-called ‘FinTech bridges’ between financial centres and regulators were one of the hot topics at the Innovate Finance Global Summit hosted in London earlier this year, attended by regulatory authorities from over 20 jurisdictions. The ADGM states: “We are committed to developing a vibrant, dynamic and sound international financial services centre. These cross-border partnerships enable ADGM to maintain a practical, open and inclusive global FinTech centre to continue serving the communities in Abu Dhabi and the greater MENA region.”

In related recent news, the Dubai International Finance Centre, ADGM's counterpart in the neighbouring Emirate of Dubai, has signed an MoU with global professional services heavyweight Accenture to collaborate on entrenching the city as a world leading hub for FinTech.