The Benefits of Prepaid Cards for SFC Licensees and Service Pay-out

For some time now, Hong Kong has enjoyed the title as one of the biggest business, financial and banking centers of mainland China. It’s favorable geographical position, the judicial system, and a fertile business environment are just some of the factors that made this city one of the world’s most popular places for foreign trade and investment.

But Hong Kong did not become an international hub for progressive startups and enterprises looking to build off-shore partnerships by chance. The city continues to invest in FinTech, aware of the impact it has (and will have) on the overall development of Hong Kong business operations.

For the purpose of this article, we would like to emphasize the benefits of quick adoption on alternative payment in an effort to support the needs of modern residents and consumers. Mobile wallets and new card solutions, in particular, have changed the financial landscape, easing the local and international transactions.

SFC licensees, specifically, have expressed their satisfaction with the benefits of prepaid card programs, which affected the rise in their numbers. In fact, just last year the number of financial institutions licensed by SFC increased by 20% and reached a record 2,030. Evidently, Hong Kong proved to be a fitting ground for private equity investors, brokers, fund managers, and other financial firms to launch their initial public offering. 

But let’s get into more details regarding the advantages of prepaid card programs (like UniCard itself) for SFC licensees.


What is SFC?

Securities and Futures Commission is an independent statutory body responsible for promoting Hong Kong as a key Chinese and international financial sector. It was established as a response to a devastating market crash in 1987 and it has successfully managed securities and futures markets, including the Hong Kong Stock Exchange.


Who needs to be licensed?

Any institution which is not an authorised financial institution and it:

  • Carries out business in one or more regulated activities,
  • Markets its services which could constitute a regulated activity if provided in Hong Kong,
  • Performs a regulated function for your principal in relation to any regulated activity.


SFC licensees and financial institutions: The needs and challenges

We are currently witnessing a greater financial market integration between Hong Kong and mainland China. Consequently, an increasing number of businesses who offer financial services choose to set up licensed entities or acquire new ones in Hong Kong.

While this decision came with a list of benefits, one of the greatest setbacks occurred when the financial entities wanted to conduct business with their off-shore partners. To be more precise - when the time came to pay the commission and cover the costs of their products and/or services. 

Traditionally, the commission/payout of the deal would be a cheque but quite often the bank in the partner’s region oversees could not accept the check in question. As a result, this would complicate and, more often than not, postpone the payment.

On a much greater scale, this represented a great obstacle for international operations. Though Hong Kong had the potential, it could not have been used to its fullest due to this and similar issues. SFC licensees and other financial service providers resorted to alternative payment methods and circumvent the banks in order to hold their end of the deal.

At this point, prepaid card solutions proved to be an appropriate and highly practical solution, which is why their popularity is on the rise, not just in Hong Kong, but on a global scale.  


How prepaid cards benefit SFC licensees and other financial entities?

The use of prepaid cards has boomed in the first decade of the 20th century and they were instantly recognized for their versatility of use - from transferring funds to family members to controlling company expenditure.

Clearly, prepaid card programs benefit international businesses enabling controlled spending, providing transparency, and generally creating new opportunities for off-shore trade of services and resources.

Without further ado, the most prominent advantages of prepaid card programs such as UniCard’s Mastercard Prepaid Card program include but are not limited to:


  • Simpler international transactions and payments

As stated above, a prepaid card can deliver what a cheque cannot. Not just any bank can accept and cash out any check, thus creating a barrier for promising international business deals. A prepaid card automates the payroll process and integrates with any payroll service provider. It is a faster and more convenient method of electronic fund transfer used by securities, insurance companies, business centers and consulting firms, as well as money service operators, SFC licensees and other financial entities. 


  • No more reconciliation

With the extinction of check, reconciliation troubles fade into obscurity, too. While regular bank reconciliation does help identify fraudulent behaviour in time, the process can be quite complex and time-consuming. Prepaid Card solutions like UniCard keep all your transaction info in one place, simplifying the administrative work that comes with forex.


  • Easier spending management

What this meant for companies that had to carry out and monitor a multitude of fragmented irregular payments on a daily basis was that they finally had a solution that would allow them to control the expenditure wisely. The information on all local and international transactions is kept in one place and is updated instantly. Anyone granted access to the transaction info can check it at any time and gain insight into the latest state of affairs.


  • Highly secure transactions

UniCard’s Prepaid Mastercard features an innovative security system which guarantees safe transactions. The transfer is safely guarded against any breaches and the state of all transactions can be easily tracked in real time.


Bottom line

It is quite interesting that the issues international partnerships have experienced for decades can be solved with a small piece of plastic. As an outcome, the market is stimulated and the oversees partnerships receive support for their endeavours.

Find out more about UniCard and how it can benefit your case!




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