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A comprehensive overview of Hong Kong's cards, payments and consumer banking market with clearsighted commentary backed by relevant data.
With the Faster Payment System enjoying one of the deepest penetrations across the world markets surveyed by Argus Advisory Research and a pandemic-prompted boost for e-commerce, app wallets and Stored Value Facility schemes, digitalisation is leading to a permanent reset in the payments market.
Although the regional and international role of Hong Kong is somewhat in flux, there is a place for a digital-first player with a regional scope that can meet the needs of its connected and digitally active population.
How this market is shaped by dual-function cards.
The effect of the hugely popular Faster Payment System.
Open Banking possibilities as transactions roll out.
The methods that are gaining ground for e-commerce.
Why credit card profitability has been on the rise.
TABLE OF CONTENTS
Demographics and the economy
Key retail banks and issuers
Acquiring and processing
Regulatory and other cards market information
Hong Kong Country Report Data Tables
(All 2016-25F unless otherwise stated)
Data table 1: Demographic and economic indicators.
Data table 2: Ownership of key consumer devices.
Data table 3: Internet usage by population.
Data table 4: Access points: 2016-23F.
Data table 5: Account penetration.
Data table 6: Consumer payment trends: 2016-23F.
Data table 7: B2C e-commerce payment methods: 2016-23F.
Data table 8: Total card payment metrics.
Data table 9: Contactless cards metrics.
Data table 10: Credit card numbers.
Data table 11: Total credit cards metrics.
Data table 12: Credit card profitability indicators.
Data table 13: Debit card numbers.
Data table 14: Debit card metrics.
Data table 15: Prepaid/e-money cards metrics.
Data table 16: Stored value facilities.
Data table 17: Mobile proximity payment metrics.
Data table 18: Profit pool: credit card numbers, billed volumes, outstandings, interest incomes, net interest revenues, merchant revenues, card fee revenues, other non-interest incomes, total revenues, net credit losses, operating expenses, total expenses, pre-tax profits, merchant service charges, rollover rates, APR, net credit losses to outstandings, operating costs to revenues, ROA (pre-tax profits to outstandings).
(All 2016-23F below unless otherwise stated)
19: Networks' credit card market shares.
20: Networks' credit card numbers.
21: Networks' credit card billed volume.
22: Networks' number of credit card transactions.
23: Networks' average credit card transaction value.
24: Networks' debit card market shares.
25: Networks' debit card numbers.
26: Networks' debit card billed volume.
27: Networks' number of debit card transactions.
28: Networks' average debit card transaction value.
29: Key credit card issuers market shares by credit card numbers: 2018-23F.
30: Key issuers market shares in credit card outstandings: 2018-23F.
31: Merchant acquirer credit card market share: 2022E.
32: Credit card merchant service charges: 2016-25F.
33: Merchant acquirer debit card market share: 2022E.
34: Debit card merchant service charges: 2016-25F.
35: Credit card issuer/issuing processor relationships: -
36: Credit card acquirer/acquiring processor relationships: -
37: Credit card issuing processor market shares by card numbers: 2022E.
38: Credit card acquiring processor market shares by the number of POS transactions: 2022E.
39: Online merchant acquirer market share. 2022E.
Demographics and Economy
Hong Kong's four key industries – financial services, trading and logistics, tourism and professional services – are the main drivers for the country's economic growth.
Mobile payments, payment cards and peer-to-peer payments have all shown rapid increases, spurred by the recent $4.6 billion in consumption vouchers issued by the government
Hong Kong is a highly developed cards market with high card penetration and a high annual spend per card, driven by a deep and wide acceptance infrastructure and a knowledgeable populace.
Mobile payments have grown rapidly, spurred on by governmental initiatives to stimulate the economy, the growing awareness of contactless, high smartphone penetration and increased availability of suitably equipped devices.
There were more than 19 million Hong Kong credit cards in circulation at the end of 2021, representing a penetration rate of about 288 cards per 100 adults.
Hong Kong has a mature credit cards market with cards issued on all major credit card networks, including Visa, Mastercard, UnionPay, JCB and American Express. Owned by a consortium of Hong Kong banks, EPS has enjoyed an effective monopoly of debit-card provision since 1985.
Key Retail Banks and Issuers
Hong Kong's banking sector is extremely competitive, with a comparatively large number of retail banks for a market of around 7.4 million people.
Acquiring and Processing
Hong Kong currently has a near-universal UnionPay acceptance network, which facilitates spending by mainland Chinese visitors. UnionPay cards are accepted at almost all ATMs. Hong Kong banks generally outsource payment processing services to specialist processors to lower operating costs.
Credit cards are the second-most popular online payment method in Hong Kong, accounting for a third of total e-commerce billed volume in 2021. The most popular method is the e-wallet.
Regulatory and Markets Information
HKMA approval is required to carry out banking business activities in Hong Kong. Those authorised by the HKMA are referred to as Authorised Institutions (AIs), of which there are three tiers.
33 Financial Services
AEON Credit Services
Bank for International Settlements
Bank of China Hong Kong
Bank of Communications Hong Kong
Bank of East Asia
BOC Credit Card
BOC Hong Kong
Chekiang First Bank
China Construction Bank (Asia)
Dah Sing Bank
Faster Payments System
Financial Services and the Treasury Bureau
First Data Merchant Solutions
Hang Seng Bank
Hang Seng Bank
Hong Kong Association of Banks
Hong Kong Book Fair
Hong Kong Census and Statistics Department
Hong Kong Food Expo
Hong Kong General Chamber of Commerce
Hong Kong Interbank Clearing
Hong Kong Jockey Club
Hong Kong Monetary Authority
Hong Kong Telecommunications
International Monetary Fund
International Telecommunication Union
Joint Electronic Services Teller
Joint Financial Intelligence Unit
Mass Transit Railway
Octopus O! ePay
Office of the Commissioner of Banking
Office of the Exchange Fund
Prestige for Life
Red Hot Rewards
Shanghai Commercial Bank
Sky Pearl Club
Tap & Go
Wing Lung Bank
ZhongAn Financial Services
Argus Advisory Research reports deliver invaluable market and competitor intelligence on payments cards, e-money, acquiring/processing, retail banking, and consumer credit. Analysts and researchers use both primary and secondary source data and conduct in-depth interviews with senior industry executives and local experts.
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