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The Hong Kong Monetary Authority (HKMA) and the People’s Bank of China (PBoC) have launched Payment Connect, a new cross-boundary payment service linking the two jurisdictions’ faster payment systems.
Payment Connect will link mainland China’s Internet Banking Payment System (IBPS) with Hong Kong’s Faster Payment System (FPS), enabling instant cross-border payments between residents in both locations.
The service will support transactions in both renminbi and Hong Kong dollars under the current account framework, and can be used for common remittance purposes, including salary payments, tuition fees, and medical bills.
The initiative is intended to improve the efficiency and convenience of cross-border remittances, as well as ensure compliance with the relevant regulatory requirements of both jurisdictions.
Participating financial institutions will be required to meet strict obligations on anti-money laundering and counter-terrorist financing (AML/CTF) and counter-proliferation financing, a joint statement from the two authorities said.
Describing the project as another significant measure by the central government to support Hong Kong’s development, the joint statement added that Payment Connect would strengthen financial cooperation between Hong Kong and the mainland, further bolster Hong Kong’s position as an international financial centre, and reinforce its role as a global hub for offshore renminbi business.
Deeper economic integration
Six banks from the mainland and six from Hong Kong, including Bank of China, Industrial and Commercial Bank of China, HSBC, and Hang Seng Bank, will participate in Payment Connect at launch.
The service will be rolled out gradually, with more institutions expected to join in due course.
The project is being implemented under the Memorandum of Understanding on Cross-Boundary Linkage of Payment Systems between the mainland of China and Hong Kong, with oversight from both central banks.
The China National Clearing Center (CNCC) and Hong Kong Interbank Clearing Limited (HKICL) will work closely with participating institutions to ensure smooth operation of the service.
The launch of Payment Connect follows similar cross-border financial initiatives, such as Stock Connect and Bond Connect, designed to deepen economic integration between Hong Kong and mainland China.
“Payment Connect is one of the key initiatives in strengthening cooperation between the Mainland and Hong Kong. The connection between the faster payment systems in both places enhances the efficiency of cross-boundary payments, supporting trade activities and personnel exchange,” said Eddie Yue, chief executive of HKMA.
“Payment Connect will cater to the daily needs of residents in both places for cross-boundary remittances and payments,” he added.
“It also signifies another milestone for the FPS in expanding cross-boundary payment.”
