Alibaba has launched Yu E Bao, a money market fund product that brings innovation and reshapes China’s online fnancial industry

Country: Chinayuebao
Year: 2013

  • Leverage on Alipay’s big-scale client base (800 Potential clients) to attract new clients
  • Transform payment service clients into fund investors, by a low-fee business model
  • The product characteristics (simple, flexible, no minimum threshold) have satisfied target’s expectations

Concept

  • Alibaba (and its third party payment service Alipay) and Tianhong (Chinese asset management company) teamed up to launch Yu E Bao (meaning Leftover treasure)
  • Alipay users have Yu E Bao accounts which are automatically created
  • Users can transfer their spare cash from their current Alipay account into their Yu E Bao one
  • Once this amount is transferred to Yu E Bao, it is automatically invested into funds, which are managed by Tianhong Asset Management Co. The portfolio is mainly composed by low-risk and highly liquid money market investment products
  • Different from a traditional fund, there are no minimum threshold on investment amount, and investors can withdraw their cash at any time. Moreover, the return is calculated and credited on a daily basis

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