A new report on China’s online wealth management sector indicates that the number of clients on the market has already exceeded 170 million.
The “Who Is the Biggest Winner – 2019 Online Wealth Management Demographic Report” (谁是最大“盈”家——2019线上理财人群报告) released by Diyi Caijing and Ant Financial indicates that China’s internet wealth management clients reached 168.55 million as of the end of June 2018, accounting for 21% of all internet users.
Online wealth management has seen rapid growth in just the past several years, given that only 98.90 million Chinese internet users (14% of the total) were participants in the market in 2016, and 128.81 million (17%) at the end of 2017.
This increase has arrived in tandem with a sizeable rise in China’s online payments users, who expanded from 531 million users to 569 million users during the period from 2017 to the end of the first half of 2018, for an attendant increase in the penetration rate from 69% to 71%.
Money market funds and bank wealth management products remain the most popular investment choices for online wealth management clients in China.
Investment of investible assets by Chinese wealth management clients
- Money market funds: 17%
- Bank savings deposits: 17%
- Bank wealth management products: 13%
- Stocks: 10%
- Insurance: 8%
- Forex/ gold/ futures etc.: 6%
- Sovereign bonds/ local government bonds: 4%
According to the report 70% of China’s online wealth management clients are male, while 30% were born in the 1990’s and 33% in the 1980’s.
20% are situated in first-tier Chinese cities, while 34% are in second-tier cities and 29% in third-tier cities.
The average annual online investment made by online Chinese wealth management clients in 2018 was 15,000, accounting for approximately 11% of their personal or household earnings that year.
51% of online wealth management users surveyed said that value preservation and stable growth were key considerations for them, while 75% said that product risk was the decisive factor when selecting investments, as compared to 63% who said it was annual returns, 54% who said it was product tenors and 54% who said platform security.