Deniz Güven CEO, Virtual Bank on on why Standard Chartered is launching a virtual bank in Hong Kong

(upbeat electronic music) (people chattering) The Hong Kong market is very unique. In terms of profitability, in terms of customer base, in terms of, you know, customer behavior. Because the population of
Hong Kong is 7.4 million. It’s not a huge market
in terms of population. But then we look at banking. There are a lot of new, different things. In terms of new product, this market’s a very advanced market. You can see all kind of new products. Unfortunately, no, we
cannot say the same thing for services and also digital platforms. Because it’s a premature market. When you look at the market in Hong Kong, the mobile banking
penetration is only 40%. If you compare this with
other markets like in Europe, in the US, you can easily see that 70%, 75% mobile banking penetrations. But in Hong Kong it’s a bit limited. There are some reasons behind it, and that’s fine though,
there’s a huge potential in this market for virtual banks. So that’s why Hong Kong
MA, HKMA, they announced virtual banking license,
this initiative in 2017. At that time, we decided
to apply for this license because there was a huge
potential, but before applying, we asked two important
questions to ourselves. The first one is, if we are
going to attack this market with our existing model,
can we attack this market with our existing model,
with our branches? The second question was,
can we defend ourselves with our existing model, if someone else, if the big tech companies,
or big think tanks, they will get, or they will
obtain, these licenses? I think that was a new
starting point for us. (upbeat electronic music)

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