The Hong Kong Treasury Department announced a consultation summary and plans to introduce the first phase of measures to strengthen regulation of licensed moneylenders as early as August this year.

On March 13, the Hong Kong Treasury announced the strengthening of regulations for licensed money lenders to address the issue of excessive borrowing and better protect the public. The Treasury will implement the related measures in two phases. The first phase, as outlined in the consultation summary, includes setting a cap on the repayment-to-income ratio for unsecured personal loans for low-income individuals, banning money lenders from requiring borrowers to provide loan guarantors, and specifying risk warning statements in their loan advertisements. These measures will be implemented in August of this year. The second phase, regarding credit reference agencies, will be implemented in June of next year. The Treasury and the Companies Registry are drafting revisions to the licensing conditions for money lenders and administrative guidelines, and are coordinating with judicial bodies to update existing money lender licenses in phases to align with the implementation schedule. To strengthen the regulation of money lenders, the Treasury conducted a public consultation from June to August of last year on various points, including regulating unsecured personal loans, protecting public rights, improving borrower assessment capacity for unsecured personal loans, optimizing complaint handling, strengthening public education, and enhancing the regulation of money lenders. The Treasury received a total of 150 submissions from various sectors during the consultation period, and also briefed the Legislative Council's Financial Affairs Committee and organized briefings for the money lending industry, professional organizations, and NGOs to explain the details. A spokesperson for the Treasury stated that the government is committed to further strengthening the supervision of money lenders to protect the rights of the public. They are pleased that various sectors of society strongly support the enhanced regulation of money lenders and believe that targeted measures should be taken to tackle the issue of excessive borrowing. Respondents generally support the main measures proposed in the consultation document and provide valuable feedback on the specific details of each measure. The Treasury will present the consultation summary and details of the measures to the Legislative Council's Financial Affairs Committee next month. The Treasury hopes that all sectors of society will continue to support the implementation of the measures to address the problem of excessive borrowing. The Treasury and the Companies Registry will maintain close communication with industry organizations through various channels to provide information and guidance to money lenders, ensuring the smooth implementation of the measures.