Banks prepare for new rules allowing Hong Kong, Macau homebuyers to bypass daily remittance cap when buying property in Greater Bay Area
- Homebuyers will be able to transfer the whole amount without facing the daily remittance cap of 80,000 yuan (US$11,240)
- New cross-border payment regime removes key ‘pain point’ for Hongkongers buying property in the bay area, says lawmaker
Staff at Hong Kong and mainland banks have been briefed on the new payment remittance rules that were issued by the People’s Bank of China (PBOC) last month, Yue said.
Several lawmakers expressed support for the changes.
“The new policy will solve key pain points for Hong Kong people who want to buy property in the Greater Bay Area as the current daily remittance limits have made it very difficult for people to transfer money to make the payment,” said lawmaker Starry Lee Wai-king.
The new cross-border payment rule is one of six new measures announced by the PBOC last month with the purpose of enhancing cross-border transactions and integration among the 11 cities of the Greater Bay Area.
Users of the Wealth Management Connect mechanism will be allowed to invest up to 3 million yuan – three times the original quota.
Julia Leung Fung-yee, CEO of the Securities and Futures Commission, said the enhancements will allow securities firms, in addition to banks, to sell products under the Wealth Management Scheme, while the choice of funds will be expanded to include China’s stock funds.
“These measures will boost the transactions of the Wealth Management Connect scheme,” she said in a separate session of the same meeting.
Meanwhile, the SFC is working with the Hong Kong stock exchange to help attract international listings from the Middle East and Southeast Asia, she said.
It is also working with the bourse to boost turnover through means such as allowing the market to remain open during severe weather and narrowing the trading spread – the gap between the buy and sell prices of stocks – so as to reduce the cost of trading for investors.
Another new policy known as cross-boundary credit referencing will allow banks in Hong Kong and the mainland to share the credit information of companies. Yue said this could later be expanded to individuals.
Yue also rejected calls by some lawmakers for using the city’s Exchange Fund to invest in local stocks and property.
“The purpose of the Exchange Fund is to support the local currency. As such, it needs to invest in foreign currency denominated assets and not local currency assets,” Yue said during the debate.