Hong Kong's status as an iconic financial capital stands in contrast to its relatively lackluster record for technology. The city is regarded as below average as a hub for startups, and MasterCard places Hong Kong in the middle of the pack for mobile payments readiness.

The bank-led consortium Jetco hopes to reverse those headwinds, starting with a clearXchange-style mobile account-to-account transfer service that's scheduled to launch during the second quarter.

"Despite the high smartphone penetration rate, and a well-established regulatory and financial infrastructure, Hong Kong consumers are less willing to use mobile payments than many of their regional and global counterparts," said Angus Choi, CEO of Jetco.

Mobile payments have long struggled to take hold in Hong Kong, despite longstanding efforts to build the market, according to Choi. Standards for Near Field Communication (NFC) have been in place for three years in an attempt to make mobile contactless payments interoperabile between providers inside and outside Hong Kong. Apple Pay is also expected to launch in Hong Kong in 2016, and should benefit from the NFC standards.

Jetco is starting with a person-to-person app, called Jetco Pay P2P, and will build out in-store payment, as well as adding network banks and expanding into Macau, an island close to Hong Kong that has an economy dominated by casino resorts.

Jetco, which has 30 member banks, has signed 12 of its members to participate in the P-to-P service, including Bank of China (Hong Kong), Bank of Communications, the Bank of East Asia, China CITIC Bank International, China Construction Bank, Citibank, Dah Sing Bank, DBS Bank, OCBC Wing Hang Bank, Shanghai Commercial Bank, Wing Lung Bank and Standard Chartered Bank.

These financial institutions will face adoption challenges that are largely due to consumer fears that often hamstring digital commerce in its early stages.

"This can be attributed to a number of factors such as security concerns, technological constraints, inadequate understanding of the service and a lack of trusted financial brands involved," Choi said.

To build out its mobile payments capabilities, Jetco has collaborated with Amsterdam-based Gemalto to provide technology for an NFC-based system. The P-to-P service operates on the consortium's long-standing ATM infrastructure, which is used to route payments executed by mobile phone numbers.

Gemalto's mobile payment partners include Samsung, which uses its technology as part of Samsung Pay.

Choi hopes the technology and the recognizable financial brands will loosen up the market for mobile payments in Hong Kong, since consumers will be using their own bank accounts and ATM system.

"Jetco Pay P2P leverages our existing interbank network of trusted financial brands to enable a wide choice of bank accounts for consumers," Choi said. "Given the service's high level of convenience and security, and support by reputable financial institutions, we are positive about the uptake as the 12 participating banks rollout the [P2P] service throughout 2016."

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