Ant Group has launched a digital investment platform within its Alipay app that allows firms to offer fund advisory services to users of the app, an Ant spokeswoman confirms.
Firms joining the platform, Tougu Guanjia, will have access to Alipay’s one billion users. The platform functions as a fund advisory/robo supermarket, where users will have the option which service to choose from.
The fund advisory market is relatively new in China. The China Securities Regulatory Commission (CSRC) launched a pilot scheme in October 2019 to test the investment advisory business in publicly-offered mutual fund investments, in a move to slowly shift away from the traditional transaction-based model to a fee-based model of selling fund products.
So far, 19 firms have been granted the fund advisory licence, including five fund management firms, three online distributors, four banks and seven securities firms.
The first batch of firms on Alipay’s Tougu Guanjia platform are the five fund management firms holding the fund advisory licence. They are Harvest Fund Management, Southern Asset Management, Zhoung Ou Asset Management, E Fund Management and China Asset Management, according to the Ant spokeswoman..
The minimum investment on the platform is RMB 1,000 ($154) and investors have three risk levels to choose from, with at least 10 investment strategies managed by the five fund firms.
ANT-VANGUARD JV
Vanguard, which has a fund advisory joint venture with Ant Group, is positive on the new platform, as it believes it should further propel China’s investment advisory market.
“The advisory market is new and growing, with the joint venture between Ant Group and Vanguard currently the largest digital advisory in the market place,” a Shanghai-based spokeswoman for Vanguard told FSA.
“We welcome more players in the advisory space, as we believe a rising tide will lift all boats by helping investors to have a greater awareness of the benefits of long-term, diversified investing.”
According to the spokeswoman, the number of users within Vanguard and Ant Group’s fund advisory service, Bang Ni Tou (“Help You Invest”), has grown to at least one million since its launch in April last year.
It was recently reported that Vanguard has scaled back its ambitions to establish a stand-alone mutual fund company, and instead will focus on its JV with Ant.
Another online distributor, Tencent, also launched its fund advisory business in the mainland in August. The service, “Invest Together”, is available via Wechat, the firm’s social media application, FSA previously reported.
