Hong Kong SVF Regime: Licensing and Reporting Under the PSSVFO

On 18 September 2026 the Hong Kong Monetary Authority (HKMA) published its stored value facility (SVF) statistics for the second quarter of 2026: 90.38 million SVF accounts in use, around 2.2 billion transactions worth HK$264.7 billion in the quarter, and HK$21.8 billion of user money held as SVF deposit and float at quarter-end. Those figures are aggregates for SVF schemes issued by SVF licensees, including relevant licensed banks that are regarded as being granted an SVF licence under the PSSVFO.

The licence carries continuing obligations that run for as long as the facility operates: a capital floor, a restriction on what other business the licensee may conduct, strict rules on how customer money must be ring-fenced, incident notification duties, and the supervisory data that eventually surfaces as those quarterly statistics. Subject to the exemptions in Schedule 8 and any exemption granted by the Monetary Authority, a person must not issue an SVF in Hong Kong without an SVF licence. Licensed banks are regarded as being granted an SVF licence; other issuers within scope must obtain a licence.

The Q2 2026 release presents quarterly aggregate data on SVF schemes issued by SVF licensees. Read the numbers alongside the rules and a clearer picture emerges: account growth is steady, float is rising, and the year-on-year fall in transaction value is concentrated in a few specific categories.

Related reading: Singapore’s stablecoin framework under the Payment Services Act, a neighbouring e-money regime built on the same licensing-plus-safeguarding logic.

The Hong Kong SVF regime at a glance

Before the detail, the fixed parameters a reporting or compliance officer needs on one screen:

• Legal basis: Payment Systems and Stored Value Facilities Ordinance (Cap. 584), in force since 13 November 2015.
• Regulator: the Monetary Authority (the HKMA), which grants and supervises SVF licences.
• Scope: a single-purpose facility is excluded from the PSSVFO definition of an SVF, while specified SVFs are exempt from licensing under Schedule 8 and the Monetary Authority may grant further exemptions. Licensed banks are regarded as being granted an SVF licence.
• Minimum financial resources for a non-bank applicant or licensee: paid-up share capital of at least HK$25 million, or equivalent other financial resources. The Schedule 3 financial-resources criterion does not apply to a bank.
• Core prudential duty: customer float must be safeguarded so it is always available to redeem the value still on the facility.
• Q2 2026 headline: 90.38 million accounts in use (up 9.2% year-on-year), HK$264.7 billion of transactions (down 7.4% year-on-year), HK$21.8 billion of deposit and float (up 7.3% year-on-year).

What the PSSVFO actually licenses

The PSSVFO provides the statutory framework for designated clearing and settlement systems, designated retail payment systems, and the licensing and supervision of stored value facilities. The Ordinance grew out of the former Clearing and Settlement Systems Ordinance, which was expanded and renamed when the SVF and retail payment system regime came into operation on 13 November 2015.

A stored value facility, in plain terms, is a facility that holds pre-paid value which the holder can later use to pay for goods and services or transfer to another person. The licensable category is the multi-purpose SVF, meaning value usable across more than one merchant or purpose. The regime splits these by form. A device-based SVF stores value on an electronic chip on a card or physical device, the classic example being the Octopus card. A non-device-based SVF stores value in a network-based account reached through an app or online, which covers the e-wallet products most consumers now use.

The distinction that trips people up is single-purpose versus multi-purpose. A prepaid instrument that can only be spent with its issuer, a single-retailer gift card or a coffee-shop app that only buys that chain’s coffee, is a single-purpose facility and stays outside the licensing requirement. Where a facility ceases to be single-purpose, it must be assessed against the PSSVFO definition of an SVF, the Schedule 8 exemptions and any exemption granted by the Monetary Authority before determining whether an SVF licence is required. Getting this scope boundary wrong in a product design review can bring a firm into the regime unexpectedly, because a feature addition can push a facility outside the single-purpose exclusion.

Who holds a licence, and who is deemed to have one

Issuing or facilitating the issue of a multi-purpose SVF without authority is prohibited under the Ordinance. The Monetary Authority may grant an SVF licence only where it is satisfied that the applicant meets the minimum criteria the Ordinance sets, and that those criteria will continue to be met once the licence is in place. This is a continuing test. A licensee that drifts below the criteria becomes a supervisory concern the HKMA can act on, so satisfying the criteria at application is only the starting point.

Banks sit in a separate lane. A licensed bank in Hong Kong is regarded as being granted an SVF licence, so a licensed bank does not apply for a separate SVF licence for that activity. That is why bank-operated wallets appear in the market without a standalone SVF authorisation, while a fintech issuer of the same kind of product must be licensed in its own right. The HKMA maintains a public Register of SVF Licensees, and the current list of authorised issuers is the authoritative record of who holds a licence at any given time.

For a firm assessing whether it needs to apply, the assessment is whether the facility falls within the PSSVFO definition of an SVF, whether it is issued in Hong Kong for the purposes of section 8B, whether any applicable exemption applies, and whether the issuer is a licensed bank regarded as being granted a licence under section 8G. Overseas schemes also require consideration of the factors the HKMA applies when determining whether an SVF is issued in Hong Kong or an invitation concerning its issue is directed to the Hong Kong public.

The capital floor and the principal business rule

For a non-bank applicant or licensee, Schedule 3 requires adequate financial resources and either paid-up share capital of at least HK$25 million or equivalent other financial resources. The Monetary Authority may impose a higher capital requirement, including as a licence condition, taking into account factors such as the risk profile, size of float, number of user accounts and complexity of the SVF business. The Schedule 3 financial-resources criterion does not apply to a bank.

For a non-bank licensee, Schedule 3 requires the principal business to be issuing or facilitating the issue of SVFs; this criterion does not apply to a bank. An SVF licensee may operate money-changing or remittance services where they are ancillary to its principal SVF business.

The reason both rules exist is redemption risk. Capital absorbs losses so the firm can wind down in an orderly way, and the principal business restriction keeps the entity holding the float from taking on obligations that could compete with users’ redemption claims. Both rules reinforce the issuer’s solvency and wind-down position; ring-fencing of float and SVF deposit from the licensee’s own funds is the separate task of the safeguarding regime.

How the float must be protected

Float is the heart of SVF supervision, and it is where the reporting stakes are highest. The Ordinance defines “float” and “SVF deposit” as distinct terms, and the HKMA uses both in its statistics for that reason. In working language, the float is the pool of prepaid money users have loaded but not yet spent, the money the issuer holds on their behalf.

The HKMA’s safeguarding standard requires an effective and robust system under which float and SVF deposit are deployed for prescribed usage only, protected against claims by other creditors of the issuer in all circumstances, and protected from operational and other relevant risks. The supervisory guidance calls for an effective trust arrangement and allows, where justified, a bank guarantee or insurance as an alternative or supplementary arrangement; the Practice Note also identifies independent payment controls, insurance and guarantees as possible additional protections.

Float and SVF deposit must be segregated from the licensee’s own funds and funds received for other business activities and must be managed mainly for liquidity purposes so sufficient funds remain available for redemption. A licensee proposing to hold a proportion in low-risk financial assets other than cash or bank deposits must obtain the HKMA’s prior written consent and demonstrate adequate protection against the relevant risks. A licensee must also hold adequate risk management policies for managing the float and SVF deposit so that sufficient funds are always available to redeem the value still on the facility. When the HKMA reports HK$21.8 billion of SVF deposit and float at the end of Q2 2026, it is reporting the size of the pool that must remain ring-fenced and redeemable at all times.

Firms coming from other jurisdictions should not assume a familiar safeguarding model maps across cleanly. The Hong Kong regime shares the safeguarding logic seen in retail payment supervision globally, such as the controls around prepaid payment products in Canada, but the specific “in all circumstances” creditor-protection standard and the trust-plus-opinion expectation are Hong Kong requirements that need to be evidenced locally.

What licensees report, and how the quarterly statistics are built

The reporting side of the regime has two layers that reporting teams should keep separate.

Guideline 7.2.2 requires timely reporting to the HKMA of confirmed IT-related fraud cases or major security breaches, including cyber attacks, cases of prolonged disruption of service, and systemic incidents where users suffer monetary loss or frustrating user experience, such as data leakage. The requirement is framed as timely incident reporting rather than a fixed calendar filing deadline.

The second is the periodic supervisory data that the HKMA collects on the scale and shape of SVF activity. This is the source of the quarterly statistics. When the HKMA publishes that 90.38 million accounts were in use and HK$264.7 billion moved through SVF schemes in Q2 2026, those aggregates are compiled from data the licensees provide on the schemes they issue. The published release is the visible aggregate; the underlying obligation to supply accurate, timely data sits with each licensee.

Governance around AML sits on its own track. The HKMA issues a dedicated Guideline on Anti-Money Laundering and Counter-Financing of Terrorism for SVF licensees, so a licensee’s suspicious transaction reporting and customer due diligence obligations flow through the AML framework, separate from the SVF prudential returns. That separation matters when a team maps its reporting inventory, because SVF statistical data, incident notifications and AML/CFT obligations arise from distinct supervisory requirements; internal ownership is for the institution to allocate within its governance framework.

Two HKMA documents anchor the supervisory expectations here. The Guideline on Supervision of Stored Value Facility Licensees, issued under section 54(1A)(b) of the PSSVFO (G.N. 5043), sets out the high-level principles the HKMA applies. The Practice Note on Supervision of Stored Value Facility Licensees, updated in October 2025, provides additional guidance and illustrations on how specific principles in the Guideline may be met. It should be read together with the Guideline and does not override or replace the requirements in the PSSVFO or the Guideline.

Reading the Q2 2026 numbers

The headline growth story is in the accounts and the float. SVF accounts in use reached 90.38 million at the end of Q2 2026, up 1.8% on the previous quarter and 9.2% higher than a year earlier. SVF deposit and float rose to HK$21.8 billion, up 0.6% on the quarter and 7.3% year-on-year. Both of these are stock measures taken at quarter-end, and both point the same way: more accounts, more prepaid money parked in the system.

Transaction activity tells a more mixed story, and this is where careful reading pays off. The number of transactions, a flow measure over the quarter, came in at around 2.2 billion, up 0.3% on the quarter and 3.6% on the year. Yet the total value of transactions, HK$264.7 billion, was almost flat quarter-on-quarter and 7.4% lower than Q2 2025. More transactions with less value is an unusual pairing, and it is worth understanding before it lands in a board pack as a simple decline.

The composition explains it. Within that HK$264.7 billion, point-of-sale spending was HK$47.7 billion, online spending HK$33.8 billion, person-to-person transfers HK$16.4 billion, withdrawals HK$59.6 billion, and adding value (top-ups) HK$107.2 billion. Compared with a year earlier, the spending components rose, with combined spending payment value up 12.8%, while the year-on-year fall was concentrated in withdrawals, person-to-person transfers, and top-up value. The figures point to the headline value decline reflecting lower withdrawal and transfer activity, with merchant spending running above the prior-year level through the same period.

For anyone drafting commentary on these figures, the discipline is to carry what each number measures. Accounts in use and float are end-of-period stocks. Transaction counts and values are quarterly flows. A ‘7.4% year-on-year fall’ is a statement about total transaction value compared with Q2 2025 and does not, on its own, describe the direction of merchant spending, which increased. The categories that moved are the story, and they are all in the HKMA’s published annex.

Where the SVF licence stops and the stablecoin regime begins

Hong Kong now runs a separate licensing regime for stablecoin issuers under the Stablecoins Ordinance (Cap. 656), and the HKMA granted its first stablecoin issuer licences in April 2026. An SVF licence does not authorise stablecoin issuance. The two regimes cover different products, sit under different ordinances, and impose different reserve, disclosure, and redemption requirements.

The confusion is understandable, because both involve holding value on behalf of users and both are HKMA-supervised. An SVF stores monetary value for use in payments or transfers under the PSSVFO, while the Stablecoins Ordinance establishes a separate licensing regime for issuers of fiat-referenced stablecoins. A firm that wants to issue a stablecoin cannot rely on an SVF licence to do it, and a firm running an e-wallet does not need a stablecoin licence to hold customer float. Mapping a product to the right ordinance is the first decision, and it drives every reporting obligation that follows. The HKMA’s broader retail payments agenda, including recent Faster Payment System enhancements, sits alongside both regimes without replacing either.

Frequently Asked Questions

Does a foreign e-wallet that Hong Kong users can access need an SVF licence?

For an overseas SVF, the relevant question is whether the facility is issued in Hong Kong or whether advertising or invitations concerning its issue fall within the PSSVFO. The HKMA applies a holistic assessment covering factors such as how the scheme is presented or promoted, the contents and functions of the issuer’s website, and precautionary steps taken to limit Hong Kong access. An overseas issuer intending to issue an SVF in Hong Kong should assess those factors and the applicable licensing requirements before launch.

Is Octopus device-based or non-device-based?

The classic Octopus card is the textbook device-based SVF, storing value on a chip. Where the same operator offers a network-based account reached through an app, that product is non-device-based. A single operator can therefore sit across both forms, which is why the regime defines the two categories by how value is stored, so the label follows the storage method.

Do banks issuing e-wallets need a separate SVF licence?

A licensed bank is regarded as being granted an SVF licence and therefore does not obtain a separate SVF licence for that activity. This deemed status applies to a licensed bank, rather than to every category of authorised institution.

What is the difference between “float” and “SVF deposit” in the statistics?

Both are defined terms in the PSSVFO, and the HKMA reports them together as “SVF deposit and float”. In working terms the float is the prepaid money users have loaded but not yet spent. The statistics combine the two into a single quarter-end figure, HK$21.8 billion at the end of Q2 2026, representing the ring-fenced pool that must remain available for redemption.

Does the HK$25 million capital requirement rise with the size of the float?

For a non-bank applicant or licensee, HK$25 million is the minimum paid-up share-capital amount, subject to the alternative of equivalent other financial resources. The Monetary Authority may impose a higher capital requirement where it considers this appropriate, taking into account factors including the risk profile, float size, number of user accounts and complexity of the SVF business.

Are single-purpose gift cards and loyalty schemes caught?

A single-purpose facility is one that can only be used as a means of payment for goods or services provided by its issuer and is not an SVF for PSSVFO purposes. Separately, Schedule 8 exempts specified arrangements, including certain cash-reward, digital-product, bonus-point and limited-use SVFs. A product change that takes a facility outside the single-purpose exclusion therefore requires a fresh scope assessment, including consideration of the Schedule 8 exemptions.

What must a licensee do if it wants to stop issuing an SVF?

Exit is a supervised event. The Guideline requires funds belonging to SVF users to be protected against claims by other creditors in all circumstances and requires sufficient funds for the refund of float and SVF deposit to all users at all times. A firm planning an exit should engage the HKMA early and treat redemption as the central design question, well before the closing formalities.

Related Articles

• MAS Stablecoin Framework Under the Payment Services Act: how Singapore licenses and safeguards a comparable e-money and stablecoin regime.
• HKMA Faster Payment System Enhancements: the HKMA’s retail payments infrastructure that sits alongside the SVF regime.
• FINTRAC Prepaid Payment Products AML Reporting in Canada: prepaid-value controls and reporting in a different jurisdiction.
• HKMA and MAS Banking Supervision MoU: how the two APAC supervisors coordinate on cross-border oversight.
• CESOP Reporting for Payment Providers: the EU’s payment-data reporting obligation for comparison with SVF statistical reporting.

Key Takeaways

• Subject to the PSSVFO exemptions, issuing an SVF in Hong Kong requires an HKMA licence; single-purpose facilities are outside the statutory SVF definition and licensed banks are regarded as being granted a licence.
• For a non-bank applicant or licensee, the minimum financial-resources criterion is HK$25 million paid-up share capital or equivalent other financial resources; the HKMA may impose a higher requirement where appropriate.
• Float and SVF deposit must be segregated and protected, managed mainly for liquidity purposes, and deployed only in accordance with the HKMA’s safeguarding requirements; investment in low-risk financial assets other than cash or bank deposits requires prior written HKMA consent.
• Guideline 7.2.2 requires timely reporting of confirmed IT-related fraud or major security breaches, prolonged service disruption, and systemic incidents causing monetary loss or frustrating user experience; AML/CFT obligations are governed separately by the applicable AML/CFT framework.
• Read the Practice Note on Supervision of SVF Licensees (October 2025) as additional guidance and illustrations to be read together with the section 54(1A)(b) Guideline; it does not override or replace the PSSVFO or the Guideline.
• Q2 2026: 90.38 million accounts in use (up 9.2% year-on-year) and HK$21.8 billion of deposit and float (up 7.3%), both quarter-end stocks.
• Q2 2026 transaction value was HK$264.7 billion, down 7.4% year-on-year, with the fall concentrated in withdrawals and transfers while merchant spending value rose 12.8%.
• An SVF licence does not authorise stablecoin issuance; that is a separate regime under the Stablecoins Ordinance (Cap. 656).

Sources and References

• Payment Systems and Stored Value Facilities Ordinance (Cap. 584), Hong Kong e-Legislation
• HKMA, Regulatory Regime for Stored Value Facilities
• HKMA, Guideline on Supervision of Stored Value Facility Licensees (G.N. 5043, s.54(1A)(b) PSSVFO)
• HKMA, Practice Note on Supervision of Stored Value Facility Licensees (October 2025)
• HKMA, Explanatory Note on Licensing for Stored Value Facilities
• HKMA, Guideline on Anti-Money Laundering and Counter-Financing of Terrorism (Stored Value Facility Licensees, May 2023)
• HKMA, Register of SVF Licensees
• HKMA, Statistics of Stored Value Facilities (SVF) Schemes Issued by SVF Licensees (18 September 2026)
• HKMA, Annex: Statistics of SVF Schemes for Second Quarter 2026 (data table)

What the next SVF statistics print will test

The Q2 2026 figures leave a clear point to watch. Accounts and float increased while total transaction value fell year on year, with lower withdrawal, P2P-transfer and add-value amounts offsetting higher merchant spending. The sources reviewed do not state a fixed publication date for the Q3 2026 statistics. For a licensee, the continuing priorities are to protect and manage float in accordance with the PSSVFO and HKMA guidance and to make timely incident reports under Guideline 7.2.2.

Disclaimer: The information on RegReportingDesk.com is for educational and informational purposes only. It does not constitute legal, regulatory, tax, or compliance advice. Always consult your compliance officer, legal counsel, or the relevant supervisory authority for guidance specific to your institution.