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Explainer | Wealth Management Connect: here’s what you need to know about the scheme that excites your bankers
- The first cross border trading scheme to focus on the Greater Bay Area will facilitate total fund flow of 300 billion yuan (US$46.5 billion)
- Individual investors can only sign up with one bank and its partner across the border
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China is soon expected to launch the Wealth Management Connect, the first cross border investment scheme in the Greater Bay Area, its latest move to further open up the mainland’s financial market and promote economic integration in the region.
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Additional details about the scheme, first mentioned in a blueprint about the Greater Bay Area’s development in February 2019, were released last week. The scheme is expected to facilitate a total fund flow of 300 billion yuan (US$46.5 billion) in terms of sales in investment products.
While China still has capital controls, it has in recent years introduced various cross-border trading schemes to gradually open up its markets, allowing mainland investors to diversify their investment. The launch of the wealth management scheme is important for the bay area’s development to encourage capital flows and investment among the 11 cities to turn them into an economic powerhouse.
Hong Kong’s Financial Secretary Paul Chan Mo-po last week said the scheme “will be rolled out very soon”. Here are a few details about the plan.
What is Wealth Management Connect?
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The Wealth Management Connect will allow Hong Kong and Macau residents to buy mainland investment products sold by banks in the Greater Bay Area. Likewise, residents of the nine Guangdong cities will also be allowed to buy investment products sold by banks in Hong Kong and Macau.
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