The Hong Kong Monetary Authority (HKMA), the Securities and Futures Commission (SFC), the Insurance Authority (IA) and the Mandatory Provident Fund Schemes Authority (MPFA) have collaborated with Hong Kong Cyberport Management Company Limited (Cyberport) to launch the Generative Artificial Intelligence (GenA.I.) Sandbox++ program.
The Hong Kong Monetary Authority, the Securities and Futures Commission, the Insurance Authority and the MPFA are Hong Kong’s main financial regulators, overseeing the banking, securities, insurance and pension industries.
The new program builds on GenA.I. Sandbox launches in 2024. The expanded Sandbox++ framework expands participation across multiple sectors of the financial sector, including banking, securities and capital markets, asset and wealth management, insurance, Mandatory Provident Fund (MPF) schemes and stored value facilities.
The program focuses on three priority areas: risk management, fraud prevention and improving customer experience. It also promotes the concept of “AI vs. AI,” which is the use of AI tools to monitor and address risks arising from the adoption of AI technologies.
Participating financial institutions will receive regulatory guidance and technical support from regulatory agencies. Participants will also have free access to the graphics processing unit (GPU) computing power of the Cyberport Artificial Intelligence Supercomputing Center. The infrastructure is designed to help institutions design, test and refine artificial intelligence applications in a controlled environment, supporting the responsible development of the entire Hong Kong financial system.
The initiative is also expected to strengthen cooperation between regulators, financial institutions and technology providers. It encourages the creation of sector-specific and cross-sector AI solutions. Potential applications include AI-powered insurance underwriting and claims processing, automated assessment of suitability requirements in the distribution of investment products, and tools to assist MPF administration.
Other use cases under consideration include industry-wide solutions such as smart customer service chatbots and advanced systems for detecting and preventing fraud.
HKMA Chief Executive Eddie Yue said: “The launch of GenA.I.Sandbox++ marks an important milestone in our ‘Fintech 2030’ strategy and reinforces our commitment to building a vibrant ecosystem for responsible innovation. By bringing together regulators, financial institutions and the technology community, we aim to fully realize the potential of artificial intelligence to drive growth, efficiency and customer-centricity across financial services, further enhancing Hong Kong’s competitiveness as a leading international financial centre.”
SFC Chief Executive Liang Fengyi said: “Expanding the GenA.I. sandbox to a wider range of capital market participants is a true testament to our collective determination to promote responsible market innovation and technology-driven and future-proof financial markets. We encourage licensed companies to actively participate in this sandbox to harness the unlimited potential of artificial intelligence to improve operational efficiency, enhance resilience and unlock growth.”
Chief Executive Officer of the IA, Zhang Yunren, added: “GenA.I.Sandbox++ is a collective push by financial regulators to create an environment conducive to AI innovation based on accountability, inclusion and prudence. This idea coincides with our AI cohort program, which stimulates interest in knowledge sharing and use case deployment, while attracting an inflow of talent, helping to enhance Hong Kong’s competitiveness as a regional AI hub.”
Cheng Yan-chi, Managing Director of the MPFA, said: “To further support the healthy and innovative development of artificial intelligence in the MPF industry, the MPFA strongly encourages MPF trustees and intermediaries to actively explore and adopt advanced financial technology solutions. Through artificial intelligence, MPF trustees and intermediaries can improve operational efficiency and service quality, and bring more value to MPF scheme members.”
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