Digital banking in Hong Kong has developed into a mature sector, with its services not only integrated into the daily lives of citizens and the operations of small and medium-sized enterprises ( SMEs ) but also earning high user loyalty and trust through its outstanding performance in security, innovation, and user experience, according to a new report.  

Results of the latest survey by The Hong Kong Association of Banks’ ( HKAB ) digital banking education taskforce show that digital banks have established a solid customer base, with 66.4% of individual users and 63.7% of SME users having continuously used digital banking services for over two years. Among these, 25.1% of individuals and 22.2% of SMEs have been using them for over four years.

Reasons cited by respondents for long-term use include digital banks becoming their primary accounts, positive user experience and convenience, and attractive offers and rewards. A high 92.9% of individuals and 98.2% of SMEs stated that digital banks meet at least 50% of their daily banking needs. Furthermore, 82.7% of individual users and 96.5% of SME users engage with digital banking at least once a week.

Security confidence

The public also holds extremely high confidence in digital banks' security measures. For measures including personal data protection, fraud prevention, and overall account security, nearly 100% of SME users and over 94.5% of individual users express trust in the data security of digital banks.  

This confidence stems from a clear understanding of the regulatory framework. The survey finds that 70.1% of the public and 82.4% of SMEs are aware that digital banks are strictly regulated by the Hong Kong Monetary Authority ( HKMA ) and protected by the Deposit Protection Scheme Ordinance.

Also, multiple digital banks have been recognized for their performance in safeguarding user privacy, receiving awards from the Office of the Privacy Commissioner for Personal Data ( PCPD ). This reinforces their professional image in data handling and information security.

Driving innovation

Digital banks are also recognized as a core force driving industry innovation, particularly in financial technology and AI applications. These include smart customer service, optimized transaction processes, data analysis, personalized product recommendations, savings advice, and security alerts for unusual transactions, all of which have significantly enhanced user experience and risk management capabilities.  

Additionally, multiple digital banks are using AI to enhance their Deepfake detection capabilities. This strengthens their ability to investigate related fraud, improves the precision of anti-fraud detection, and provides greater protection for customers.  

A high 92.7% of the public and 99.4% of SMEs agree that digital banks are more forward- thinking than traditional banks in adopting AI technology. The application of AI has also tangibly translated into better customer experience, with 84.9% of the public and 98.8% of SMEs stating that AI-driven services have enhanced the perception of a "smarter and more convenient" banking experience.

Immense potential

Gigi Wong, spokesperson for the HKAB digital banking education taskforce, comments: “The establishment of user habits and trust demonstrates that digital banking is not merely 'viable' but is becoming mainstream. As the user base continues to expand, the industry has also begun to achieve profitability, further validating the sustainability of this operating model.  

“This is not only a recognition of the industry's efforts but also a clear signal that the financial ecosystem is being reshaped. As digitally native financial platforms, we firmly believe that digital banks hold immense potential in areas such as AI applications, data analytics, and smart financial management.” 

The HKAB taskforce commissioned the School of Communication at Hong Kong Baptist University to conduct the online questionnaire survey from August 13 to 26 this year. A total of 1,006 individual respondents and 205 SMEs were interviewed.