HKMA directs Authorized Institutions to review de-risking policies and offer basic banking to higher-risk individuals
Hong Kong retail banks must review and revise de-risking policies to provide basic banking to higher-risk individuals case-by-case, not refuse them outright
HKMA
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Change
On 27 May 2026, the HKMA issued a circular setting supervisory expectations for banking services to higher-risk individuals, directing Authorized Institutions to review and where necessary revise their policies and to consider offering basic banking services to such individuals on a case-by-case basis with safeguards, rather than applying blanket de-risking based solely on a higher-risk classification.
Why it matters
The circular follows an HKMA review finding that some AIs' treatment of higher-risk individuals — including those under investigation or prosecution but not yet convicted — does not adequately address genuine needs for basic banking services. AIs are expected to avoid a one-size-fits-all approach and to consider offering basic banking services to higher-risk individuals residing in Hong Kong on a case-by-case basis, subject to appropriate safeguards and limitations, where a broader range of services is not appropriate to the assessed risk. The expectation explicitly weighs AML/CFT risk management against financial inclusion, and applies particularly to AIs providing retail banking to individual customers, which should review and where necessary revise their policies and procedures in line with the Annex guidance.
Implications
- — Retail-banking Authorized Institutions in Hong Kong must review and, where necessary, revise their account-opening and account-maintenance policies for higher-risk individuals and implement a case-by-case framework for providing basic banking services with safeguards, limitations, and risk-calibrated scrutiny — refusing service as a matter of course based solely on a higher-risk classification no longer meets the HKMA's supervisory expectation, including for individuals under investigation or prosecution who have not been convicted.
- — AML/CFT and banking-conduct teams at AIs must document the risk-based rationale for the level of service offered and communicate clearly to affected customers that basic services are calibrated to assessed risk — the circular sets an explicit expectation of clear customer communication and a move away from one-size-fits-all de-risking, which supervisory engagement will assess.
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