The adoption of generative artificial intelligence (GenAI) in Hong Kong’s financial services sector is rapidly growing, with a recent survey revealing that 75% of companies are currently designing or implementing at least one GenAI use case. This figure is expected to rise to nearly 90% within the next three to five years, according to a study published on Wednesday by the Hong Kong Institute for Monetary and Financial Research (HKIMR), the research arm of the Hong Kong Academy of Finance.
The study, which involved 55 entities from the insurance, wealth, and asset management sectors, found that larger financial institutions are leading the charge in GenAI adoption. Approximately 83% of large firms have either launched GenAI applications or are in the process of doing so, compared to 63% of smaller companies.
Enoch Fung, CEO of the Academy of Finance and executive director of HKIMR, emphasized the transformative potential of GenAI in the financial services industry, noting its ability to enhance customer experiences and improve efficiency in processing and utilizing digital information.
The surveyed firms represent a significant portion of Hong Kong’s financial sector, accounting for 57% of total bank deposits and 48% of gross premiums in the insurance industry.
GenAI, which enables models to learn from training data to generate outputs such as text, images, and video, is seen as a powerful tool for innovation. However, the study also highlighted potential risks, including concerns around model accuracy, data privacy, and security. The report also cited challenges related to resources and talent needed for effective GenAI integration.
In response, Hong Kong’s regulatory authorities have begun updating guidelines to support responsible GenAI adoption. Initiatives such as updated circulars on GenAI models, the introduction of a GenAI sandbox, and industry-wide events promoting knowledge exchange are already in place.
Fung stressed the importance of maintaining safety, trust, and integrity as the financial services sector moves forward with GenAI adoption. To further advance its integration, the sector must focus on creating a level playing field and enhancing local technology and talent ecosystems. This includes expanding financial literacy programs, improving infrastructure, and fostering collaboration among stakeholders to address key issues such as accountability, data localisation, and data protection.
The HKIMR report suggests that these efforts will be crucial in ensuring the responsible and sustainable growth of GenAI in Hong Kong’s financial landscape.
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