One million buy China's first online investment fund
Updated: 2013-06-20 16:39
HANGZHOU - The number of buyers of "Yu'E Bao," regarded as China's first online investment fund aimed at individuals, has exceeded 1 million since its trial launch last Thursday.
The fund was introduced by Alipay, China's largest third-party payment platform. It gives Alipay's near-800 million users the option to directly invest with the private TIANHONG Fund using spare cash from Alipay accounts.
The 1 millionth user was from the city of Jiuquan in Northwest China's Gansu province, Alipay said on Thursday.
The annual earnings rate for investors in the fund is around three to four percent, while the current interest rate for one-year deposits is 3.25 percent, according to the TIANHONG Fund.
Set at one yuan ($0.16), the minimum threshold for fund investment with "Yu'E Bao" is far lower than the conventional tens of thousands of yuan.
Users can redeem funds at any time, and the capital can be used directly for online payments or transferred even without redemption.
Alipay is a subsidiary of China's E-commerce giant Alibaba Group, which announced at the end of 2012 that total transaction volume at the group's online shopping platform Taobao.com exceeded 1 trillion yuan by November, or 5.4 percent of the country's retail sales for consumer goods in 2011.
Considering Alipay provides an online payment service for Taobao.com, a large amount of spare cash rests in the Alipay accounts of Taobao users.