HK FinTech Growth Index
HK FinTech Growth Index 2020
The FGI represents responses to an annual survey by 27 companies, 11 less than last year.
The Hong Kong FGI for the financial year 2019-20 is 120.9, up 20.9 index points from 2018-19. The FGI expected for the financial year 2020-21 is 133.6, an increase of 12.7 index points (or 10.5%), representing a positive outlook for Fintech development in Hong Kong in the coming year despite the impact from the anti-extradition bill protests and COVID-19 outbreak.
Of the four sub-indices, the Business Environment sub-index, measured by both internal and external factors on FinTech business operations and development, is 105.8, 5.8% higher than 2018-19. The sub-index is expected to increase by 9% to 115.8 in 2020-21, attributing to improvement in external factors including more funding opportunities and a safer and more stable investment environment in the coming year.
The Business Performance sub-index, measured by FinTech customer adoption rate and revenue, is 143.4, 43.4% higher than 2018-19, and is expected to increase by 28.4% to 184.1 in 2020-21, representing a positive outlook in business development by the FinTech industry. Of the responded companies, 70.4% mentioned talents acquisition as the main challenge in business operation which has become more difficult.
The Investment on R&D or Product Development sub-index is 126.6 for 2019-20, 26.6% higher than 2018-19 and is expected to drop by 2% to 124.1 in 2020-21. The downturn can be attributed to FinTech companies lowering their investment on R&D or product development. In 2019-20, FinTech companies mainly spent their R&D or product development expenditure on Customer experience (59.3%), AI, big data and machines/deep learning (44.4%) and Mobile solutions (33.3%).
The Demands on Talents sub-index is 107.9, 7.9% higher than 2018-19 and is expected to increase by 3% to 110.6 in 2020-21. The expected growth rate is lower than sub-indices Business Environment and Performance which indicates that companies are turning conservative in hiring talents due to the downside revenue risk. On the required skills for new employees, programming skills (85.2%) are the most preferable skills for new hires, followed by marketing expertise (48.1%). IT infrastructure skills (42.1%) have evolved to be a more important skill set than in 2018-19.