Europe’s PSD2 doesn’t directly impact Hong Kong, but its monetary decision makers support open banking frameworks, sparking a network of banks to support that effort through the help of HSBC and Swift.
The two parties are jointly defining a standard for APIs, and plan to engage the Hong Kong banking industry to review and agree on how the standard will work.
The effort builds off of the Hong Kong Monetary Authority’s Open API Framework, formed in 2018 to encourage open development in Hong Kong. More than 20 banks have made about 500 APIs available through the framework.
The Swift/HSBC-driven standard will allow merchants to set up direct debit authorization and create similar processes for common use cases. It’s also designed to ensure interoperability with the Hong Kong Faster Payments system’s clearing and settlement system by using ISO 20022, a widely used standard for payment networks globally.
Swift and HSBC hope this will make it easier for Hong Kong banks to support faster payments for cross-border international transfers.