The Hong Kong government has outlined progress in developing new financing channels based on intellectual property (IP), including an IP Financing Sandbox and a forthcoming patent valuation support scheme for small and medium enterprises (SMEs). The initiatives aim to help innovation-driven firms use intangible assets as collateral, strengthen confidence among financial institutions, and support research commercialisation. Details were provided in a Legislative Council response published on the official government release on 3 June 2026.
The measures form part of Hong Kong’s broader effort to develop into a regional centre for intellectual property trading and financing, a direction supported in both the National 14th and 15th Five-Year Plans. The government has been implementing policies to strengthen the city’s IP ecosystem, complementing wider initiatives to expand innovation capacity and investment in technology development, as highlighted in Hong Kong’s review of its innovation and technology funding strategy.
IP Financing Sandbox Tests New Lending Approaches
The Commerce and Economic Development Bureau, the Intellectual Property Department (IPD) and the Hong Kong Monetary Authority launched the IP Financing Sandbox in December 2025. The initiative allows banks, enterprises and professional service providers to test financing arrangements that use IP assets as part of lending assessments.
Three major banks are currently participating in the pilot alongside clients from different sectors, particularly technology-related industries. The sandbox approach allows stakeholders to test real cases in a controlled environment, helping them build experience in assessing intangible assets as collateral while managing financial and regulatory risks.
According to the government, at least one financing application has already been approved under the programme, while other pilot cases remain under review. Authorities plan to collect feedback from participating organisations before deciding whether to expand the number of participating banks or widen the range of pilot projects.
The initiative is intended to help enterprises unlock new funding sources for research and development as well as commercialisation activities. It also seeks to build trust among banks, valuation professionals and legal experts involved in structuring IP-backed financing.
Pilot Scheme To Improve Patent Valuation For SMEs
To address longstanding challenges around valuing intangible assets, the government will also introduce a two-year Pilot Patent Valuation Support Scheme through the Hong Kong Technology and Innovation Support Centre. The programme is designed to help local SMEs obtain professional valuation of patents and other IP assets.
The scheme is expected to launch in the third quarter of 2026. It will operate on a matching grant basis, with the government providing up to HK$80,000 per approved enterprise to support the cost of hiring qualified valuation service providers.
If the enterprise holds at least one Hong Kong patent granted under the Patents Ordinance (Cap. 514) that has undergone substantive examination, IPD patent examiners will also provide a qualitative patent evaluation free of charge through the support centre. Valuation providers may refer to this qualitative assessment when conducting quantitative valuation of the enterprise’s IP assets.
The government has allocated HK$28 million to support the patent evaluation service and the implementation of the pilot programme. Authorities expect the scheme to help SMEs better demonstrate the economic value of their intellectual property while providing lenders with more reliable information during credit assessments.
Guidelines To Support Banks’ Credit Assessment
Recognising that financial institutions often face uncertainty around the liquidity and stability of intangible assets, the Intellectual Property Department is preparing guidance on the minimum information required in valuation reports produced under the scheme. The aim is to ensure greater consistency in reporting standards and enable banks to incorporate valuation results more effectively in loan assessments.
Local banks have already been briefed on the scheme through the Hong Kong Monetary Authority and have responded positively to the proposal. The government will monitor the programme’s progress and review its effectiveness in improving acceptance of IP-based valuations within financial risk management frameworks.
The measures complement broader policy efforts to strengthen the city’s IP ecosystem and encourage new financing models. Recent initiatives have focused on expanding intellectual property trading activity and strengthening market infrastructure, as outlined in Hong Kong’s ongoing work to advance its intellectual property trading and financing agenda and related initiatives such as the city’s intellectual property strategy highlighted during World IP Day 2026.
Officials say these initiatives will help strengthen Hong Kong’s role as a regional IP trading centre by combining the city’s financial services sector with its legal and professional expertise.
This article is created with the assistance of OpenGov AI.