How do I open an account, deposit money into and withdraw money from a virtual bank?

If you are interested in virtual banking services, the first step to take, naturally, is to open a virtual bank account. Yet, as there are no bricks-and-mortar branches, how do you open an account with a virtual bank?

Virtual banks make wide use of fintech in place of human-operated services. “Remote account opening” is one of the examples. Using a mobile phone, clients can access the mobile app or the website of a virtual bank, scan proof of identity, take a selfie and then submit certain personal information, and the account opening procedure is basically completed. Compared with the need to spend time queueing up to open an account at a conventional bank, “remote account opening” is undoubtedly more efficient and convenient. Certainly, this service is not only available from virtual banks; it is also offered by some conventional banks.

As for deposits and withdrawals, a virtual bank is connected to FPS, the instant, cross-platform transfer system. Clients can transfer funds in and out through this channel. Furthermore, depending on the service offered by the virtual bank, clients can also use an ATM to make cash deposits or withdrawals.

Both virtual banks and conventional banks are licensed banks and regulated by the HKMA. Although virtual banks operate differently from conventional ones, they are still required to comply with the same set of prudent regulations as conventional banks. In addition, virtual banks and conventional banks are both members of the Hong Kong Deposit Protection Board. Each customer who makes a deposit into a virtual bank is also entitled to deposit protection of up to HK$500,000. Despite having no physical branch, a virtual bank must maintain a physical office in Hong Kong as its principal place of business in the territory to deal with client enquiries or complaints.

Technology-related risks are of vital importance to virtual banks, in particular information security, system resilience and business continuity. A virtual bank must have appropriate security and technology controls in place and engage a qualified expert to perform an independent assessment. The assessment report must be submitted to the HKMA. Learn about what to be aware of as a virtual bank customer.