sector and the expanding cluster of technology talents and industrial base, the bay area is going to become one of the main engines of growth for china and a very fertile ground for innovation in financial services and fintech. 9. recognising the importance of cross - border collaboration in the bay area, the hkma, as a start, has signed a fintech mou with the office of financial development service ( “ ofds ” ) 2 / 4 bis central bankers'speeches of the shenzhen municipal government. now, i am pleased to announce that, in pursuing our commitment to collaboration, hong kong and shenzhen will jointly launch three fintech initiatives : ( i ) a fintech competition ; ( ii ) a soft - landing scheme ; and ( iii ) a talent development programme. fintech competition 10. together with the shenzhen ofds, we will organize a fintech competition that is open to participation by shenzhen and hong kong financial institutions. it offers total prizes of more than hk $ 7 million for the winning fintech products or solutions. i am sure the awards will provide a strong incentive for financial institutions to innovate, either by themselves or in partnership with fintech firms. there are two categories of awards, both of which are open to shenzhen and hong kong - based regulated financial institutions. the first is for the use of fintech, while the second is for cross - border financial innovation. it is a prestigious award and i would encourage hong kong financial institutions to take part and showcase their achievements. the director - general of ofds will share with us more details about this exciting competition in the next session. soft - landing scheme 11. the second initiative is a mutual referral system for fintech firms – this is sometimes called “ soft - landing ”. under this programme, the ofds will provide support to hong kong fintech firms that want to establish a presence in shenzhen, perhaps with a view to using it as a springboard to tap into the enormous market of mainland china. 12. to better utilise this valuable opportunity, we are working with our strategic partner, cyberport, on the establishment of cross - border soft - landing facilities in shenzhen. such an arrangement would give qualified hong kong fintech firms access to the business support from ofds, which would be helpful for these firms to expand their business to the mainland. at the same time, cyberport will leverage on this platform in shenzhen to assist mainland fintech companies to establish operations in hong kong. 13.

for working very hard with us on this most meaningful collaboration. 4. hong kong and singapore are the two leading international financial centres in asia. both the hkma and mas are actively promoting the use and development of fintech respectively. there is considerable scope for the two places to collaborate and achieve a win - win outcome. a priority area of collaboration is the use of fintech in advancing the hitherto paperbased trade finance system that has been in use for as long as trade existed. as we know, trade finance is an integral part of the global trading system and the paper - based system is very inefficient and prone to human errors and fraud. but then it has proved to be very difficult for the trade finance processes to be automated or digitalised mainly because multiple parties and banks in different jurisdictions are involved in a single trade transaction. unless there is a common global standard for the digitisation of trade - related documents and a trusted central repository, it is pointless for any party or jurisdiction to change the paper - based system on its own. however, with the breakthrough of the distributed ledger technology ( dlt ), we firmly believe that the time has come for trade finance to move into 1 / 4 bis central bankers'speeches the digital era. together with a consortium of five banks in hong kong, the hkma conducted in the second half of 2016 a proof - of - concept project on the use of dlt to build a trade finance platform in hong kong. i am pleased to announce that the proof - of - concept project has been successful in that it can digitise trade documents, automate the processes, allow sharing of required documentation among authorised participants, and reduce human errors and risks of fraud. we are therefore moving into the next phase of the project by developing a full production system. the consortium, now joined by two more banks, is in the process of conducting tender for the system development. we aim to build an open system in which other banks in hong kong are welcome to join if they are interested. it is obvious that the new platform will create the highest value if the majority of banks engaging in trade finance businesses are making use of it. 5. however, this is only half of the story. as we all know, trade is by definition cross border and invariably involves parties and financial institutions in two or more jurisdictions. so it is not good enough for a jurisdiction to do it alone in digitalising trade finance. in this connection, i am pleased to