Hong Kong’s central bank has announced measures that top financial institutions of the city plan to deploy in support of local small businesses, Reuters reported Wednesday (Oct. 16).
Nine top banks in Hong Kong have reportedly agreed to several measures in support of small businesses amid ongoing anti-government protests, reports said. Those measures include the agreement to “proactively consider” allowing small businesses impacted by the protests more time to repay their debts without changing their loan terms.
The Hong Kong Monetary Authority (HKMA), Hong Kong’s central bank, noted that banks that agreed to reschedule or delay loan repayments from small business borrowers would not have to classify those loans as non-performing or shore up cash in the event of non-payment, reports added.
Though the central bank announced the measures, it did not name the nine banks that agreed to them.
According to reports, Hong Kong’s economy shrunk by 0.4 percent between April and June compared to the previous quarter, with protests continuing to put pressure on the market. The retail industry has been particularly affected, with retail sales down 23 percent year over year in August, reports said, citing government figures. That decline marks the worst in Hong Kong’s recorded history.
Hong Kong has recently enacted separate measures to support its FinTech and financial services market unrelated to addressing market concerns from the protests.
In May the HKMA issued more online-only banking licenses, raising the total of such licenses granted to eight as the government aimed to accelerate digital banking and FinTech innovation.
“Eight new ambitious and well-capitalized ‘challenger’ banks coming to market in or around the same time have the potential to inflict considerable damage on incumbent players, as well as on each other,” said James Lloyd, EY’s Asia Pacific FinTech leader, in a statement at the time. “Expect fireworks.”
The government kept small business banking and financial services in mind with the granting of these licenses, reports noted.