COVID-19 driving the adoption of digital investment tools in HK

By Edil Corneille

An HSBC survey has apprised that the citizens of Hong Kong have readily adopted digital tools for managing wealth, thereby reflecting their investment savviness and flexibility in the current times. The survey showcases that around 70 per cent of Hongkongers invest at least twice a year as compared to 40 per cent of consumers in Singapore.

The adoption of digital means to invest has accelerated due to the COVID-19 outbreak where the pandemic has been a catalyst for the increase in usage of the digital methods.

The survey shows that nearly two-thirds of Hongkongers have made short term (66 per cent) investments via online channels using either a PC, laptop, smartphone or tablet. Meanwhile, three quarters have made long term investments (75 per cent) and over half have done so through digital channels (56 per cent).

Sami Julian Abouzahr, Head of Customer Wealth, Wealth and Personal Banking, Hong Kong, HSBC said, “Hong Kong is one of the world’s leading wealth hubs, and as digital banking becomes more pervasive, we have seen that Hong Kong customers – from new savers to savvy investors – are increasingly managing their investments using mobile and online banking. Moreover, COVID-19 accelerated the adoption of digital channels for wealth management, including FX, funds, equities and portfolio management – whether this be via an app or a video call with a relationship manager.”

The latest HSBC data shows that total digital retail sales (products such as mortgages, bank accounts and credit cards) in Hong Kong grew by 63 per cent year-on-year in Q1 2020. In the first 5 months of the year, the bank’s average monthly equity trading turnover via digital channels increased by over 50 per cent year-on-year.

Andrew Eldon, Head of Digital, Wealth and Personal Banking said, “…The COVID-19 pandemic has underscored the benefits and convenience of digital services for customers, who can now manage their personal finances through mobile channels, anytime and anywhere – an option many customers have embraced. Long term, we know that millennials are more likely to adopt our highly flexible mobile solutions, and so we need to accelerate our digital delivery to connect with these customers and capture this next wave of growth.”

61 per cent of Hongkongers use a smartphone app to check their bank balance compared to 75 per cent of Singaporeans. This implies that there is scope for growth in the usage of digital banking channels for non-wealth, day-to-day transactions. Similarly, only half (50 per cent) of Hong Kong citizens pay their bills/ add payees using smartphone apps versus 67 per cent for their Singaporean peers – showing the opportunity for customers to further benefit from the efficiency and convenience of digital channels.