Loan Referral Agreement Template for Hong Kong

A Loan Referral Agreement is a legally binding contract that governs the relationship between a referring party and a licensed lender in Hong Kong. This document establishes the terms under which one party will refer potential borrowers to another, ensuring compliance with Hong Kong's strict financial services regulations while protecting both parties' interests.

When do you need this document?

You need a Loan Referral Agreement when establishing formal referral relationships in Hong Kong's financial sector. Banks use these agreements when partnering with mortgage brokers or property agencies to generate loan applications. Licensed money lenders require them when working with financial advisors or corporate services providers who introduce clients. Insurance companies and wealth management firms use these agreements when referring clients for financing needs. The document is also essential for credit companies partnering with business introducers to expand their customer base while maintaining regulatory compliance.

Key legal considerations

Your agreement must clearly define the scope of referral services and whether the arrangement is exclusive or non-exclusive within specific territories. Compensation structures require careful drafting to ensure compliance with Hong Kong regulations, including flat fees, percentage-based commissions, and performance incentives. Data protection clauses are critical given the Personal Data (Privacy) Ordinance requirements for handling customer information during referrals. You must include specific compliance obligations under the Money Lenders Ordinance, particularly regarding proper licensing verification and customer due diligence requirements. Anti-money laundering provisions must address record-keeping and reporting obligations under the AML/CFT Ordinance. The agreement should also specify termination procedures, intellectual property rights, and dispute resolution mechanisms under Hong Kong law.

Legal requirements in Hong Kong

Under the Money Lenders Ordinance (Cap. 163), all parties must verify that lenders hold valid money lending licenses before making referrals. The Personal Data (Privacy) Ordinance (Cap. 486) requires explicit consent mechanisms for collecting and sharing customer data between referring parties and lenders. Your agreement must comply with the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) by including customer due diligence procedures and record-keeping requirements. The Trade Description Ordinance (Cap. 362) mandates truthful representation of loan products and services in all referral activities. Hong Kong common law governs contract formation and enforcement, requiring clear offer, acceptance, and consideration terms. Additionally, the agreement must address regulatory reporting obligations and ensure all marketing materials comply with Hong Kong financial services advertising regulations.