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The Hong Kong Monetary Authority announced the launch of the SAGE project (Securing Agentic Finance with Governance and Enablement) on November 2 and the establishment of an expert group on agentic finance to study the use and governance of AI agents in financial services.

The SAGE project was announced during Hong Kong FinTech Week. The HKMA said "agentic finance" — in which AI agents can carry out financial operations on behalf of users — could change the way customers use financial services. However, the associated risks and challenges must also be properly managed, making it necessary to ensure that governance frameworks are in place while promoting practical applications.

Four areas of focus, with liability just one of them

The project will focus on four areas:

  • Market development and exploration of use cases: Potential areas include business-to-consumer (B2C) agentic shopping and everyday payments, business-to-business (B2B) procurement and treasury management, and machine-to-machine (M2M) usage-based payments for digital services.
  • Agent identity: Examining ways to verify the identities of AI agents and their authorised permissions, including "Know Your Agent" (KYA) measures and identity authentication mechanisms.
  • Interoperability standards: Promoting industry discussion on relevant standards and protocols.
  • Legal and regulatory frameworks: Exchanging views on governance arrangements, liability and consumer protection.

It should be noted that the areas outlined by the HKMA currently concern research and discussion, rather than rules that are already in effect. Media reports said the announcement did not disclose an implementation timetable or provide details of specific pilot results. As for who would be responsible if an AI agent carried out an operation without authorisation, the HKMA only said it would exchange views on issues including liability; there is no answer for now.

22-member expert group brings together payments, technology and e-commerce sectors

The expert group has 22 members from financial institutions, technology service providers, professional services firms and academia. It will consolidate practical experience from different use cases, explore interoperability standards, identify development risks and pain points, and make recommendations on governance frameworks and safeguards. According to reports, members include Mastercard, Ant International, Circle Hong Kong and Google Cloud. UnionPay International, JD Technology (parent company JD.com: 9618.HK) and A3A PayTech have also separately announced that they have joined. The full membership list will be subject to the HKMA's announcement.

Separate banking-sector discussion paper issued on the same day

According to reports, the HKMA also issued a discussion paper on the use of agentic AI by banks on the same day, seeking industry views on governance and regulatory considerations. A survey released by the Securities and Futures Commission during the same period found that 30% of the institutions surveyed had adopted agentic AI, while another 25% were conducting pilot projects.

HKMA Chief Executive Eddie Yue Wai-man said agentic finance had the potential to reshape the delivery and use of financial services, and that he hoped to strengthen Hong Kong's leading position in next-generation fintech while promoting innovation. He later said at a forum that he hoped to work with the industry to establish simple and easy-to-understand "guardrails".

What to watch next

  • When specific KYA requirements will be announced. The direction has been set, but it remains unclear which verification methods will be recognised and where the minimum thresholds will lie.
  • Whether the project has set a timetable and phased milestones.
  • The scope of pilots for use cases such as B2C everyday payments.
  • Industry views collected through the banking-sector discussion paper.