Country _ Name
Financial advisory and broking services including robo advisory and auto-trading
FinTechs belonging to this category offer advisory and broking services for investments usually via an internet platform.

Robo advisory services usually offer an investment proposition following a series of questions concerning the personal financial background and the risk-bearing capacity of the user. Sometimes the respective platform also enables the user to directly execute the proposed investment. 

Auto-trading concerns all services which automatically trade on behalf of the customer according to his or her specifications.

Apart from that some FinTechs collect and offer merely or as an ancillary service market information or operate comparison portals to increase the transparency of the capital markets and to help the investor with his decision-making. 

There are also FinTech-advertising-services which advertise various financial services or products.


Attitude of the country towards modern financial advisory and broking services

 There is a potentially huge market for intelligent asset management, which also presents opportunities for the development of modern financial advisory services. Many institutions, however, have slowed down the pace of financial advisory services recently. The situation is caused by the strong regulatory oversight of the fund investment advisory business, as well as the fact that these institutions have recognised the potential risks and have adopted a more prudent attitude accordingly.

Legal affairs

Obligations and requirements to provide financial advisory and broking services, or ancillary services described above

To engage in securities and futures investment advisory business, the entity shall obtain an investment consulting services license issued by the CSRC. The applicants shall satisfy relevant qualification requirements, such as the registered capital (more than RMB1 million (equivalent to approximately USD157 thousand or EUR142 thousand)), proper premise, professional, internal control mechanism. In practice, due to the policy control, it is very difficult to obtain such license issued by CSRC for now. Further, the personnel engaging in securities and futures investment advisory business shall join a licensed investment advisory institution and obtain the securities and futures investment advisory qualification.

The FinTechs in this area should be careful not to make the investment on behalf of customers, rather than providing advice, unless they further obtain the license of a security broker. Currently, CSRC is strengthening the supervision on investment consulting services provided online. In practice, several FinTechs were imposed with the administrative penalties due to being involved in security trading without the license of a security broker.

Auto trading and broking services are deemed as operating in the security brokerage business, which shall be subject to the license for security business issued by CSRC. The entity holding the security business issued by CSRC is the security company. The registered capital of the security company shall be no less than RMB50 million (equivalent to approximately USD7.9 million or EUR7.1 million). The net assets of the major shareholders of the securities company shall not be less than RMB50 million (equivalent to approximately USD7.9 million or EUR7.1 million); the first major shareholder or/and the controlling shareholder of the securities company engaged in business with significant leverage shall have total assets of not less than RMB50 billion (equivalent to approximately USD7.9 billion or EUR7.1 billion) and net assets of not less than RMB20 billion (equivalent to approximately USD3.1 billion or EUR2.8 billion). 

Additional comments regarding the legal situation for financial advisory and broking services, or adjacent services or what FinTech&rsquo

;s must be aware of in this business area CSRC issued the Securities Fund Investment Advisory Business Management Measures (Draft for Comments) in 2020, requiring that the net worth of the applicant shall not be less than RMB100 million (equivalent to approximately USD15.7 million or EUR14.2 million). This means that the threshold for engaging in financial advisory services might be further increased in the future.

The current trend is to tighten the regulation of intelligent investment advisory services, but it is still unknown whether the restrictions will be relaxed in the future to stimulate market dynamics.

Economic conditions

Market size for financial advisory and broking services as well as adjacent services and biggest companies in this business area

According to Statista Data, the assets under intelligent management are expected to exceed USD660 billion in 2022, covering 103 million people.

According to the latest China Intelligent Investment Advisory System Study (Q4 2021) report, the top 10 overall ranked smart investment advisory platforms consist of the early established independent third-party institutions, large banks, fund companies, and institutions that rank highly in fund sales, including the Help You Vote of the Group Co., Ltd., Capricorn Wise Investment of China Merchants Bank, Sinan Wise Investment of China Southern Asset Management Co., Ltd. etc. 

Additional comments regarding the economic situation for financial advisory and broking services as well as adjacent services or what FinTech’s must be aware of in this business area

In a comprehensive manner, the development of financial advisory and broking services relying on technologies is still at a relatively early stage, while it is foreseeable that the platforms with the first-mover position will have the market advantage for a long time.



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