Visa & ANZ join HKMA e-HKD Pilot Programme for cross-border payments

Visa and ANZ have been chosen to participate in the second phase of the Hong Kong Monetary Authority (HKMA)'s e-HKD Pilot Programme. This initiative will focus on exploring cross-border payments and the interoperability of asset investment using tokenisation technologies.

The HKMA has also launched Project e-HKD+, which aims to broaden the scope by exploring innovative use cases for new forms of digital money usable by both individuals and corporates. This includes the potential use of e-HKD and tokenised deposits. As part of the 12-month Phase 2 of the Pilot Programme, Visa and ANZ will investigate various methods to enable Australia-based corporates to invest in Hong Kong-based investment funds through digital money.

The two companies plan to utilise a tokenisation solution designed to help banks issue fiat-backed tokens within a sandbox environment. This will allow them to test a Delivery vs Payment (DvP) settlement use case involving e-HKD and tokenised bank deposits as part of Project eHKD+. The programme will explore near-real-time settlement for interbank transfers and cross-border payments, facilitating Australia-based corporate investors' purchases of tokenised fund units offered by ANZ's asset management clients, which include Fidelity International and ChinaAMC (HK).

In Phase 1 of the e-HKD Pilot Programme in 2023, Visa collaborated with two major banks to study use cases for interbank B2B payment flows, including property payments and acquirer-merchant settlement, through the use of tokenised bank deposits.

Paulina Leong, General Manager of Visa Hong Kong and Macau, commented on the initiative: "Enabling secure payments across borders is central to what we do at Visa. We are committed to working with partners to simplify the process for both businesses and consumers at every step. Our work in Phase 2 of the Pilot Programme aims to drive innovations that could enhance the efficiency and transparency of cross-border payments. From remittance and commercial payment to procurement and trade settlement, we are harnessing cutting-edge technologies like blockchain and tokenisation to strengthen our payments infrastructure and pave the way for a more seamless, secure, and inclusive financial future."

ANZ has been involved in exploring the use of decentralised networks and asset tokenisation with customers, including the development of an AUD stablecoin (A$DC) and the tokenisation of financial assets.

Nigel Dobson, ANZ Banking Services Lead, stated: "We are pleased to have been selected for the HKMA's e-HKD Pilot Programme Phase 2 and look forward to demonstrating how our existing network, data, and technology capabilities can support our multinational and institutional customers moving goods and capital across the region. We welcome the opportunity to collaborate on this pilot. We see significant potential to improve efficiency for funds management clients through our emerging Digital Assets capabilities such as A$DC."

Emma Pecenicic, Head of Digital Propositions and Partnerships, Asia Pacific ex-Japan at Fidelity International, said: "Exploring the link between tokenised currencies and tokenised funds is primordial in an interconnected digital assets ecosystem. With this pilot, Fidelity International will be expanding opportunities for cross-border distribution thanks to the tokenisation of funds and tokenised money, including HKD and AUD. Fidelity International is thrilled to partner with Visa and ANZ for HKMA's Phase 2 e-HKD Pilot Programme, as we stand at the forefront to innovate in our offerings and how we support ever-changing clients' needs."

Thomas Zhu, Head of Digital Assets and Family Office Business at China Asset Management (Hong Kong), also commented: "ChinaAMC (HK) is honoured to have been selected for Phase 2 of the e-HKD Pilot Programme. Building upon the initial successes achieved by the HKMA in Phase 1, which demonstrated the versatile applications of e-HKD, we look forward to working closely with the HKMA and esteemed partners to explore more use cases of e-HKD and tokenised funds."