MR CHAN KIN-POR (in Cantonese): President, let me first declare that I am an independent non-executive director of the Bank of East Asia. Virtual banks provide banking services mainly through the Internet or electronic transmission and they are characterized by the lack of physical branches. However, HKMA is currently promoting what is called financial inclusion and has asked physical banks to establish branches in remote areas. Considering that virtual banks do not have physical branches, how will the Government ensure that they will meet the requirement of financial inclusion so that virtual banks and physical banks will jointly share this social responsibility or obligation?
SECRETARY FOR FINANCIAL SERVICES AND THE TREASURY (in Cantonese): President, the Honourable Member has made it very clear that virtual banks basically do not have physical branches and their transactions are mainly conducted through the Internet. That is the concept of virtual banks. We have not imposed any special requirement for banks to establish branches, but have encouraged and reminded both physical and virtual banks to consider the concept of financial inclusion, i.e. to provide banking services in some remote areas or to the small number of people who have no access to these services. Nevertheless, as transactions of virtual banks are conducted through the Internet, these banks can assist people who live in areas without bank branches to conduct banking businesses with their computers, or more often, with their mobile devices such as mobile phones.
Besides, HKMA will introduce a faster payment system in the third quarter of next year. That will also assist different payment systems, including banks and stored value facilities, in conducting inter-bank or inter-institutional transfers. In the future, if people have an account with a virtual bank on the Internet, they can have access to various banking services. That will reduce the inconvenience caused by living in areas where there are no bank branches.