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Cybersecurity in Hong Kong’s Financial Services Industry

The COVID-19 pandemic has accelerated the shift to remote and online operations in the financial sector, increasing the need for robust cybersecurity measures.

Rise of Virtual Banks and Insurers

• The transition to online services has exposed financial institutions and their staff to a greater degree of cyber risk.
• Regulatory bodies have recognized this issue and have issued circulars reminding licensed corporations to assess their operational capabilities and implement appropriate measures to manage cybersecurity risks.

Balancing Cyber Safety and Business Friendliness

Maintaining a cyber-safe yet business-friendly environment is essential for the development of the financial sector in Hong Kong. This balance is crucial for the growth of virtual banks and insurers, which rely heavily on online operations.

Cybersecurity as a Foundation for Business Opportunities

A robust cybersecurity framework can serve as a foundation for developing business opportunities, such as:

• The development of a cyber-insurance market
• Expanding to insure the cyber risks of intangible assets like cryptocurrency and other digital assets

Growing Demand for Cyber-Insurance

The global cyber insurance market is expanding quickly, with an annual growth rate of approximately 20% - 25%.

Future of Cyber Insurance

In the future, the cyber insurance market will likely be expanded to insure the cyber risks of intangible assets such as cryptocurrency and other digital assets.

Need for a Clear Cybersecurity Policy Direction

Hong Kong needs a clear, up-to-date cybersecurity policy direction to navigate this rapidly changing landscape. This will ensure that the financial sector remains secure and resilient in the face of evolving cyber threats.