Hong Kong to reportedly test retail digital currency for mortgage pricing

Hong Kong is set to launch a new trial of pricing and distribution of mortgages, this time with retail e-HKD.

According to the South China Morning Post, the Hong Kong Monetary Authority (HKMA) is preparing to launch a new round of testing of the digital currency called e-HKD. This time, the HKMA reportedly wants to pilot e-HKD with selected participants in mechanisms such as pricing and distribution of mortgages in the region.

Citing the HKMA, the report states that with e-HKD, Hong Kong residents can borrow from multiple lenders at preferential rates and benefit from faster approval and disbursement. However, it is unclear whether the region will establish a new regulatory body to oversee any activity related to mortgage and lending practices involving e-HKD.

Several financial institutions in Hong Kong, including Boston Consulting Group (BCG) and ZA Bank, had already expressed interest in this use case during their initial pilot programmes. BCG estimates suggest that the use of e-HKD could expand to tokenized assets, digitizing approximately $4.6 trillion worth of assets, primarily residential properties.

The acceleration of the pilot coincides with China recently launching its first pilot outside the mainland, introducing the digital yuan, also known as e-CNY, in Hong Kong. The digital yuan is currently undergoing trials for cross-border payments, allowing Hong Kong residents to load up to CNY 10,000 (about $1,385) into their digital wallets through 17 retail banks in Hong Kong, including Standard Chartered Bank, ZA Bank and DBS Bank. knows. .