Qianhai red tape: relief coming for Hong Kong businesses, but opening mainland Chinese bank accounts still a hassle
- Opening a mainland bank account takes too long and requires trips across border, businesses complain
- Shenzhen Qianhai Authority’s Admiralty office will offer some services to investors from next month
Hong Kong firms in Shenzhen’s expanding Qianhai economic zone will soon find it easier to settle various company matters without having to cross the border, but opening a mainland Chinese bank account remains challenging, according to a top official.
Witman Hung Wai-man, principal liaison officer for Hong Kong at the Shenzhen Qianhai Authority, which manages the economic zone, told the Post that services such as lodging applications to change shareholders and authorised capital will be available at its Admiralty office from next month.
He said the authority was looking into appointing a banking partner in Hong Kong to help companies open bank accounts for their Qianhai operations.
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Investors have complained about the drawn-out process to open a bank account, including having to go to Qianhai to finalise matters in person.
“I understand the pain of the bank account issue because of my personal experience,” said Hung, who revealed that he had faced problems himself with his mainland bank account.
“We are trying to resolve it. A difficulty is that it involves the national regulator China Banking Regulatory Commission.”
Created in 2009 to foster service industry cooperation between Shenzhen and Hong Kong, Qianhai has about 11,500 Hong Kong companies that make up more than 10 per cent of registered taxpaying enterprises there.
Positioned as a centre of reform and opening of the country’s financial services sector, Qianhai received a boost earlier this month when Beijing approved expanding its area eightfold from 14.9 sq km to 120.6 sq km.
A third of the expanded area is earmarked for Hong Kong investors.
Hung promised that more policies would be rolled out to attract Hong Kong companies to tap into fast-growing Qianhai and overcome various obstacles pioneer businesses have faced there.
Howard Kwok, co-founder of a wine trading start-up, said it took a year to set up a company bank account in Shenzhen, and the firm’s five founders were required to go in person to settle some procedures.
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“We couldn’t afford to go through weeks of compulsory quarantine across the border just to help the bank verify the identity of the bank account holders,” he said.
His wine-trading company, StockVins, is based in Cyberport and set up an office in Qianhai early last year. None of the co-founders travelled across the border since Covid-19 struck early last year.
Without a corporate bank account, the company could not pay the salaries of its three employees in Qianhai, Kwok said.
“We went back and forth with the bank in question and finally had to mail our home return permits across the border and complete the verification of our identities in the bank’s branch in Hong Kong,” he said.
The corporate account was finally opened early this year. Until then, the three employees were paid through the personal account of one of the partners.
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The hassles faced by Hong Kong businesses contrast with how easily mainlanders in Shenzhen can complete most of the procedures to open a bank account over the popular social media platform WeChat.
The Shenzhen Qianhai Authority’s Hung told the Post he understood the businesses’ frustrations as he had also run into a problem with his mainland bank account.
His account’s fund withdrawal function was paralysed recently after he renewed his home permit. To reactivate it, he must go across the border in person to show the bank his new permit.
He has yet to do so, partly because he will have to spend three weeks in compulsory quarantine on the mainland.
He said the authority was trying to address the banking issue, adding: “We are looking into partnering with a bank to provide administrative services in Hong Kong to minimise these hassles.”
Hong Kong businesses in Qianhai pointed out other problems they have faced there.
Home-grown financial technology firm WeLab, which started from scratch at the economic zone in 2014, has run into challenges recruiting staff.
It recently set up a research and development hub with about 400 employees, and plans to add another 200 over the year ahead.
He pointed to official data which showed that the monthly salary of a programmer had risen 10 per cent to about 15,200 yuan (HK$18,000) in March, compared with the beginning of last year.
He urged the authorities to provide easier or faster cross-border travel.
Loong said there was also no policy to allow Hong Kong companies the freedom to run banking or brokerage businesses in Qianhai or the Greater Bay Area.
“Hong Kong companies are treated like foreign companies, very differently from mainland companies,” he said.
“Qianhai will be expanded massively and will open its arms wider to Hongkongers, which means there will be more people and traffic flow,” Chan told a radio show. “An investment into the rail link, which is a mass carrier, environmentally friendly and efficient, is worth considering.”
He added there was space at Hung Shui Kiu, near Yuen Long district, budgeted for rail development. The Post learned four stations were being planned to connect Qianhai and Hung Shui Kiu.
