Lending rules: Hong Kong
What the published rules require for unsecured consumer loans in Hong Kong, in the order a loan is made, and how TS LMS handles each step.
Last reviewed 22 October 2026 · Email me when these rules change
Lender type covered Licensed money lender (Money Lenders Ordinance, Cap. 163)
- 01
What licence do you need to lend in Hong Kong?
Licence and conduct rules
What the rules require
Money lending in Hong Kong is regulated under the Money Lenders Ordinance (Cap. 163), administered by the Registrar of Money Lenders (Companies Registry). Licences carry licensing conditions explained in the Registrar's 'Guidelines on Licensing Conditions of Money Lenders Licence' (April 2026 edition, effective 1 August 2026), covering third-party disclosure, the fee ban on intermediaries, explanation of terms, personal data, debt collection, advertising, referees, systems and procedures, AML/CFT, affordability and DSR caps. Condition 12 requires the lender to maintain systems so that its staff, agents and appointed third parties comply with the conditions and the Ordinance. The Registrar's notice of 21 September 2026 revises the risk warning statement that every advertisement must carry under Condition 9(b), for use from 1 January 2027: "To borrow or not to borrow? Borrow only if you can repay!"
Effective 1 August 2026 · Rules as of 21 September 2026 · Source: Guidelines on Licensing Conditions of Money Lenders Licence (April 2026) · First-phase measures to enhance regulation of licensed money lenders take effect today · Revised Risk Warning Statement under Licensing Condition 9(b) [for use from 1 January 2027] · 修訂放債人牌照牌照條件第9(b)條所述的風險提示字句 [由2027年1月1日起使用]
How TS LMS handles it
For a Hong Kong lender, TS LMS will not start until the licence number and the complaints contact are set, and the Hong Kong rules (rate checks, affordability, signing and collection limits) apply to every loan of that lender.
- 02
Is there an interest rate cap in Hong Kong?
Interest rate cap and extortionate level
What the rules require
From 30 December 2022, the statutory interest rate cap under the Money Lenders Ordinance (s.24(1)) is 48% p.a. (previously 60%). The effective rate above which a loan is presumed extortionate (s.25(3)) is 36% p.a. (previously 48%), and a court may then reopen the transaction. The change was made by a Legislative Council resolution passed on 26 October 2022.
Effective 30 December 2022 · Rules as of 30 December 2022 · Source: Amendments to statutory interest rate cap take effect from tomorrow · Government welcomes approval of reduced statutory interest rate cap for lending · Legal Service Division Report on Money Lenders (Amendment) Regulation 2022 (LC Paper LS49/2022)
How TS LMS handles it
TS LMS calculates the effective annual rate with all fees included. A product priced at or above 36% a year (the level the law presumes extortionate) needs a recorded reason and approval when it is set up. A product above 48% (the legal cap) is refused at set-up.
- 03
How are loan fees regulated in Hong Kong?
Fees and charges
What the rules require
Licensing Condition 4 prohibits a money lender from allowing anyone to charge, recover, demand or receive fees or consideration for procuring a loan, including fees paid to an appointed third party. Condition 2 bars lending where a non-appointed third party is involved, and requires appointed third parties to confirm in writing that they charge the borrower no fees. Since 1 August 2026, amended Condition 13 also bans asking for or using loan referees.
Effective: being checked against the official text · Rules as of 1 August 2026 · Source: Guidelines on Licensing Conditions of Money Lenders Licence (April 2026) · Additional and Revised Licensing Conditions effective 1 August 2026
How TS LMS handles it
Every charge on a product counts towards the rate check, each product carries a ceiling on the total cost of credit, and staff cannot set a charge above the product's.
- 04
What affordability checks are required in Hong Kong?
Affordability assessment and records
What the rules require
Licensing Condition 15 requires the lender, before any unsecured personal loan, to assess whether the borrower can repay affordably and to have due regard to the result. From 1 August 2026, Condition 16 bars unsecured personal loans to low-income earners (monthly income of HK$12,000 or less) where the debt servicing ratio exceeds 35% (income of HK$6,000 or less) or 40% (HK$6,001 to HK$12,000), or where the repayment period runs past the remaining employment contract. The DSR covers all unsecured repayments to banks and money lenders, including the new loan. The lender must keep written, video or audio records showing compliance.
Effective 1 August 2026 · Rules as of 1 August 2026 · Source: Additional and Revised Licensing Conditions effective 1 August 2026 · Guidelines on Licensing Conditions of Money Lenders Licence (April 2026), Conditions 15-16 and Annex 8 · First-phase measures to enhance regulation of licensed money lenders take effect today
How TS LMS handles it
Each assessment (income, spending, other repayments, employment contract end date) is stored unchanged with the rules in force and who recorded it; a loan is refused without a current passing assessment, or if the instalment or the term goes beyond the limits.
- 05
Can loan contracts be signed electronically in Hong Kong?
Loan agreement and signing
What the rules require
How TS LMS handles it
The agreement is stored unchanged and signed electronically only after approval; the signature record keeps who signed, when, the agreement's fingerprint and the device. Money is released only after a copy has been delivered, by a second staff member who is not the approver, and not if the payout account differs from the one approved.
- 06
What identity checks and anti-money laundering duties apply in Hong Kong?
KYC and AML/CFT
What the rules require
How TS LMS handles it
ID document and face checks, and sanctions and PEP screening, are built in. A sanctions match blocks approval and release until compliance clears it with a second officer's confirmation, and a PEP match needs a written enhanced due-diligence note before staff approval.
- 07
What are the data protection and credit bureau rules in Hong Kong?
Personal data and credit reference
What the rules require
How TS LMS handles it
Personal data is kept for set periods by type and then removed, and a borrower's request to access their data can be answered from the system. Contacting a borrower's emergency contact requires the borrower's recorded consent.
- 08
How is debt collection regulated in Hong Kong?
Debt collection
What the rules require
How TS LMS handles it
Calls and messages are limited to set hours, and calls to a set number a day. Contact with third parties can be switched off entirely, or allowed only as an exception with the borrower's consent and, where set, compliance approval, using a script that never mentions the debt. Every contact is logged.
This page summarises published rules for general information; it is not legal advice. Rules change: check the current text with the authority before acting.
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