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WeChat Pay’s Wealth Management Arm

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

WeChat Pay has launched a new money-market fund as its parent Tencent Holdings seeks to expand its payment services to help diversify business in the face of uncertainties in its gaming segment.

Tencent’s LiCaitong, similar to Alibaba’s Yu’e Bao, was released last year, inviting users to test the platform’s functions. The new features – which allow users to earn interest from their balance as well as transfer payments to pay bills, send virtual red packets and pay off credit card debts – were rolled out to a small pool of users in September last year. The move is seen as an attempt by WeChat Pay to catch up with Alipay, which operates the world biggest money-fund market Yu’e Bao and is the country’s third-party payments provider.

Tencent last week posted better-than-expected US$3.4 billion third quarter profit on social advertising and investment gains, which helped offset slower growth in its games segment which has faced uncertainly due to government regulation. WeChat Pay first started competing directly with Yu’e Bao in 2014 when Tencent introduced its own online wealth management service Licaitong, a platform offering a range of financial products for investors. It later added pension funds and at the end of the third quarter its aggregated customer assets surpassed 500 billion yuan (US$72 billion), according to Tencent.

Unlike Yu’e Bao, Licaitong initially did not pay interest on the balance held by users. However, this perceived gap will be filled by Lingqiantong. Tencent also recently began a trial of its personal credit scoring system, ranking users based on their social, security, wealth, trust and consumption metrics on the dominant messaging app WeChat. The system is similar to the Sesame Credit programme run by Ant Financial Services, which is the operator of Alipay.

Online wealth management has emerged as a mainstay fintech operation for one of China’s leading tech giants. Fintech accounts for an increasing share of Tencent’s business after emerging as its most rapidly growing area of operation and the second largest source of revenue behind gaming and advertising. Tencent’s 2018 Q3 report indicates that fintech accounted for around 17% of its 80.6 billion yuan in operating revenues for that quarter. Online wealth management is a key source of growth in Tencent’s fintech operations, particularly given the rapid clip of expansion in the broader sector.

China’s online wealth management sector expanded from 215.297 billion yuan in 2013 to 3.15 trillion yuan in 2019 for near six-fold growth. In the five years since the launch of WeChat Wallet in January 2014 Tencent’s wealth management vehicle Tencent Licaitong has seen its funds rise to 500 billion yuan, while its user base has surpassed the 150 million thresholds. Tencent Licaitong launched its “Salary Wealth Management Plan” in January 2016, before obtaining a fund agency sales license in January 2018 via affiliate Tencent Tengan. In September 2018 Tencent Licaitong also launched China’s first two online pension funds. At present, WeChat Pay wealth management’s fund products cover share funds, mixed funds, bond funds and indexed funds, and already fully encompass all major fund categories. Tencent has launched nearly 300 funds and cooperates with over 40 fund companies, mainly engaging in cooperation with the top 3 – 5% of financial institutions.

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