Hong Kong Fintech Regulations Guide 2025

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Hong Kong’s fast‑growing fintech sector is transforming how people invest, trade, and manage money. But with opportunity comes tightening regulation. Startups must navigate a framework that includes the Securities and Futures Ordinance (SFO), the Anti‑Money Laundering and Counter‑Terrorist Financing Ordinance (AMLO), and new virtual asset service provider licensing requirements. By 2025, enforcement and supervision have intensified, making early, accurate legal guidance critical for fintechs aiming to scale without compliance missteps.

Who Regulates Fintech Companies in Hong Kong?

The main financial regulators are:

• Securities and Futures Commission (SFC) — regulates securities, futures, asset management, automated trading services, and certain virtual asset activities.
• Hong Kong Monetary Authority (HKMA) — supervises banks (including virtual banks), stored value facility (SVF) providers, and certain payment systems.
• Customs and Excise Department — licenses and supervises money service operators (currency exchange and remittance businesses).
• Privacy Commissioner for Personal Data (PCPD) — enforces the Personal Data (Privacy) Ordinance (Cap. 486), covering personal data protection and cybersecurity obligations.

Note: Depending on your business model, you may require oversight from more than one regulator.

Do I Need an SFC Licence?

You may need an SFC licence if your fintech business engages in any regulated activities under the SFO, such as:

• Type 1 — Dealing in securities (including certain security tokens)
• Type 2 — Dealing in futures contracts
• Type 4 — Advising on securities (including certain virtual assets treated as securities)
• Type 5 — Advising on futures contracts
• Type 7 — Providing automated trading services (ATS)
• Type 9 — Asset management (including managing virtual asset portfolios above the de minimis threshold)

The SFC now treats certain digital asset activities as regulated if the tokens have the characteristics of securities or futures contracts, or are part of a collective investment scheme.

AML / CFT Rules for Fintechs

All SFC‑licensed corporations, HKMA‑regulated entities, money service operators, and licensed virtual asset service providers must comply with the AMLO.

Key AML/CFT obligations include:

• Customer due diligence (CDD) — including KYC, beneficial ownership checks, and ongoing monitoring
• Record‑keeping — generally for at least 5 years
• Suspicious transaction reporting — to the Joint Financial Intelligence Unit (JFIU)
• Compliance officer & MLRO — appointing a Money Laundering Reporting Officer and ensuring staff training

Unlicensed fintechs are not directly subject to AMLO, but the SFC and HKMA expect risk‑based compliance measures in line with industry standards. Regulators may still investigate if there are money laundering or terrorist financing red flags.

Digital Assets and Crypto Regulation in 2025

Hong Kong operates dual licensing regimes for virtual asset trading platforms (VATPs):

• SFO regime — for platforms trading security tokens (Type 1 & Type 7 licences)
• AMLO regime — for platforms trading non‑security tokens (virtual asset service provider licence)

Key 2025 rules include:

• Mandatory licensing — centralised VATPs operating in Hong Kong or actively marketing to Hong Kong investors must be licensed by the SFC under the relevant regime(s).
• Retail access permitted — since 1 June 2023, licensed VATPs may offer trading in eligible large‑cap virtual assets to retail investors, subject to token admission criteria, suitability checks, and disclosure requirements.
• Token admission criteria — non‑security tokens must have at least a 12‑month track record and be included in at least two acceptable indices by independent providers; smart contract audits are required.
• Stablecoins — not permitted for retail trading until a separate regulatory framework is implemented.
• Ongoing obligations — include risk management, cybersecurity, insurance/compensation arrangements for client assets, and segregation of client funds.

DeFi, NFTs, and other emerging products:

Regulation is evolving. Even if a product is not expressly covered today, it may fall within existing laws if it has characteristics of securities, futures, or collective investment schemes.

How can Ask.Legal help fintech founders?

Ask.Legal helps startups:

• Understand SFC compliance obligations
• Simplify AML policy drafting
• Stay ahead of Hong Kong fintech regulations
• Interpret regulatory changes using AI tools

For more tips on compliance, see our guide on data protection for SMEs in Hong Kong.

Need help navigating this issue? Check out Ask.Legal — our AI-powered legal assistant is ready to help 24/7.

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