HSBC used the Money 20/20 Asia conference in Singapore this week to reveal more details on its Project Iceberg initiative to meet competition from online rivals by launching its own stand-alone digital bank.

News of the planned new digital operation first became public last September, when reports stated that HSBC had recruited more than 100 people to the secret project, based in offices in the Aldwych area of central London.

The reports also suggested the new digital bank would focus on small business customers and could even launch before the end of 2018 in “beta” testing mode.

HSBC ‘not a tech inventor’

This week’s update on the project came from Andy Maguire, HSBC’s group managing director and group chief operating officer. He was interviewed in Singapore by Bradley Leimer, co-founder of the boutique consultancy firm Unconventional Ventures,

Maguire, who has stressed on previous occasions that HSBC is “not in the business of inventing technology”, said that the group has partnered with more than 100 fintech start-ups to ensure the new venture offers innovative and efficient services.

“We use them because they work in every country that we work in,” he added. “We do have pride in what we do, but we are not an invention business and we want people who have answers.”

He went on to explain that while the group has experienced success in the retail market, establishing the new business banking neobank aligned to who HSBC aimed to serve from day one. While customer experience is a priority, it plans to “deliver the best of both worlds and use existing backend structures without hindering the front end.”

Maguire added that HSBC plans to encourage those who are not existing customers to join and it has ambitions to expand to other markets.

“You need to be thoughtful about where you deploy, and we don’t just invest in proof-of-concepts, we want to scale. I want to know that my business colleagues are committed to take it to production,” he said.

“The clever thing to do is if people like us think it’s useful, and 30 other people do too, then we can partner with 10 corporate partners who will drive innovation by solving problems, get smart fast and from there, we can get wisdom from these other players but also be a voice of influence.”

Project Iceberg follows HSBC’s UK rival Royal Bank of Scotland (RBS), which launched Mettle, its own digital bank focusing on small businesses in November 2018.