HSBC offers rebates, fee cuts for SMEs in Hong Kong

HONG KONG • HSBC said yesterday that it will offer rebates and fee reductions for small and medium-sized enterprises (SMEs) in Hong Kong, as the city's economy struggles.

Hong Kong is on the verge of its first recession in a decade, weighed down by the prolonged trade war between the US and China, as well as months of anti-government protests that have spread across the territory, disrupting traffic, scaring away tourists and paralysing shopping areas.

HSBC, the biggest bank operating in Hong Kong, said it would offer a six-month interest rate rebate on loans approved under official financing and loan guarantee schemes for SMEs, fee subsidies for applications for the financing guarantee scheme, and reductions in transaction fees for businesses using HSBC's mobile payment service.

The London-headquartered lender did not quantify how much the measures will cost it. It is the only large lender in Hong Kong to have come up with the measures recently.

While HSBC offered fee subsidies for the financing guarantee scheme last year, its larger support packages for SMEs have come during times of significant economic stress for Hong Kong.

The last time the bank launched a package of SME support measures was in 2009 following the global financial crisis, according to a bank spokesman, and before that, it was in 2003 as the city was hit hard by the Sars (severe acute respiratory syndrome) outbreak.

Hong Kong is HSBC's single biggest market, accounting for 52 per cent of the bank's US$12.4 billion (S$17.2 billion) in first-half pre-tax profits this year.

SMEs account for over 98 per cent of local enterprises and around 45 per cent of total employment, Mr Terence Chiu, HSBC's head of commercial banking in Hong Kong, said in a statement yesterday.

"We have spent time listening to our customers and heard their voices at this difficult time," he said. The statement did not refer to the political protests directly.

The Hong Kong Retail Management Association, which represents more than 8,000 businesses, urged all landlords last week to halve rents for six months and warned that if the situation continued, "many retailers may have to sack staff".

REUTERS

A version of this article appeared in the print edition of The Straits Times on August 29, 2019, with the headline 'HSBC offers rebates, fee cuts for SMEs in Hong Kong'. Print Edition | Subscribe