Here's what you need to know on how to invest in the Wealth Management Connect

Wealth Management Connect last Friday,, Greater Bay Area

The launch of the cross-border Wealth Management Connect last Friday, Beijing’s first scheme tailor-made for the 11 cities of the Greater Bay Area, marks a further opening up of China’s capital market.

The scheme allows Hong Kong and Macau residents to invest in onshore Chinese fund products through banks in the development zone, while residents in nine mainland Chinese cities in Guangdong province can invest in Hong Kong and Macau wealth products through local lenders.

An initial quota of 300 billion yuan (US$46.5 billion) in fund flows in both directions has been approved by the authorities for the 72 million residents of the Greater Bay Area.

Banks in Hong Kong like HSBC and Bank of China (Hong Kong) submitted applications on Monday to the Hong Kong Monetary Authority, but the city’s de fact central bank is likely to take some time to approve them. In all probability, the earliest the first products could be launched will be in October.

Wealth Management Connect last Friday,, Greater Bay Area

Hong Kong banks like HSBC are gearing up to launch wealth products catering to mainland investors from the Greater Bay Area. Photo: AFP

Here is what you need to know on how to invest in the new connect scheme:

Who is eligible to invest in the Wealth Management Connect?

To invest in products offered by Hong Kong banks, Chinese investors must have a hukou – or a household registration – in the nine mainland cities of the Greater Bay Area. Alternatively, residents who have paid individual tax or social security in these cities for five years are eligible. Besides, they must also have at least two years of investment experience and a household net worth of 1 million yuan, or total financial assets of 2 million yuan.

For Hong Kong identity card holders, both permanent and non-permanent residents, there is no restriction on their experience or assets.

What are the requirements for Hong Kong residents?

A Hong Kong investor needs to open a remittance account with a Hong Kong bank and an investment account with the local lender’s mainland partner bank. Each individual can only set up one account with one bank on each side. They can use their existing mainland bank account to invest in the scheme, or they have go to the mainland in person to open one.

The HKMA said it was working with the mainland authorities on a pilot plan to allow remote bank account opening as cross-border travel was not possible because of the pandemic.

What are the requirements for mainland investors?

Normally, mainland residents require a valid three-month visa for opening a Hong Kong account. However, this has been waived for those who open an investment bank account with a Hong Kong bank under the Wealth Management Connect scheme. The mainlanders can either come to Hong Kong to open an account in person or they can open account from the mainland remotely by attestation. They will also need to open a remittance account with a mainland bank that is a partner of the Hong Kong lender. Each mainland investor can open one investment account each in Hong Kong and Macau.

Do investors have go to a bank branch to buy the products?

No. After opening the remittance and investment accounts, all investors can trade online or call their bankers to trade the products.

How does the quota affect investors?

Each investor can only trade up to 1 million yuan on a net remittance basis. For example, if a Hong Kong investor remits 800,000 yuan from Hong Kong to the mainland to purchase investment products and later sells some of the products for 200,000 yuan and remits that money back, then he or she will have used 600,000 yuan of the quota. If the 1 million quota is reached, the investment account is suspended and the individual cannot invest more but is only allowed to remit the funds.

What products can investors buy?

The mainland investors can buy mutual funds, bonds and other foreign currency deposits from Hong Kong banks. Both HSBC and BOC(HK) have said they will each offer more than 100 investment funds. Hong Kong residents can invest in low and medium-risk fund products in China.

Can they shift their investments to buy stocks or property?

No. The Wealth Management Connect scheme is a closed loop, which means that after investors trade the products, the funds must be remitted back across the border.

News Related


World Bank discontinues Doing Business reports — bank's statement

In June 2020, data irregularities on Doing Business 2018 and 2020 were reported Read more »

As Virat Kohli steps down as T20I captain, a look at what happened to brand Dhoni without captaincy

Virat Kohli Surpasses MS Dhoni To Register Most Test Wins As India Captain (Image: Reuters) The Board of Control for Cricket in India (BCCI) on Thursday announced that Virat Kohli ... Read more »

Avigna Industrial & Logistics Park to invest Rs 500-600 crore to develop a warehousing project in Karnataka

Expanding its industrial warehouses in the country, Avigna Industrial and Logistics Park, has ventured into Hoskote in Karnataka, with a 4 million sq ft Grade A warehousing facility and will ... Read more »

Yamal's gas production capacity 25% above planned — governor

At the same time, Dmitry Artyukhov continued, it is not clear whether gas production will grow next year Read more »

Ahmedabad Airport to be closed for runway repairs from January - May 2022

Sardar Vallabhbhai Patel International Airport, Ahmedabad. Image source: ANI Sardar Vallabhai Patel International Airport could be closed from 3rd January 2022 till May 31, 2022, from 9 am to 6 ... Read more »

How Picnic wants to conquer France and Germany with Bill Gates' millions

Just under two years after the previous investment round, online supermarket Picnic has again raised capital to continue growing. A group of old and new investors is investing 600 million ... Read more »

Gas price surge blamed for UK fertiliser factory shutdowns

Just a day after steelmakers reported disruption to production from soaring energy costs, it emerges that work has been suspended at two UK fertiliser plants. Read more »

A new defence alliance, fast fashion and the future of AI technology

Listen to “A new defence alliance, fast fashion and the future of AI technology.”. A new defence alliance could be a big financial blow for France – as Britain, the ... Read more »

Tobacco giant Philip Morris clinches shareholder backing for inhaler maker Vectura

PMI says the takeover is part of its "beyond nicotine" strategy and aim to become a "wellness" company - but critics fear it could see big tobacco wielding influence over UK health policy. Read more »

ASOS boss sets out sustainability goals

Read more »

John Lewis charters ships to navigate Xmas supply disruption and warns on price pressures

The retailer is no stranger to the sector's supply chain and hiring challenges in the run-up to the crucial Christmas season that seems set to see consumers facing tough spending choices as prices rise. Read more »

Fossil fuel firms sue governments across the world for £13bn as climate policies threaten profits

The majority of the cases are being brought under the Energy Charter Treaty, and are being hosted within the International Centre for The Settlement of Investment Disputes, a branch of the World Bank. Read more »

Why investors in three FTSE 350 firms are cheering the AUKUS security pact

Sky's Ian King says shareholders of Rolls-Royce, BAE Systems and Babcock clearly see hope of lucrative work arising from the sharing of information and resources under the deal. Read more »

Expert: Second Arktika-M satellite launch to assure entire Northern Sea Route coverage

The first special Arktika-M satellite was launched in February 2020 and another such satellite will be launched in 2023 Read more »

Defence Ministry issues SOP for faster verification of bank guarantees during acquisition process

Defence Minister Rajnath Singh The Defence Ministry on Thursday issued a standard operating procedure (SOP) that induces clarity in the steps a buyer has to take to verify bank guarantees ... Read more »

US market will surpass India's in the near future: MPL's Sai Srinivas

Indians love playing games on mobile phones, and home confinement during the pandemic has accelerated the trend. This has triggered a boom that helped Mobile Premier League (MPL), India’s latest ... Read more »

Google, Apple fail to explain their position to Russian senators

According to Deputy Head of Roskomnadzor Vadim Subbotin, the Apple representative was unable to explain the motive of the company’s actions and the Google representative had no power of appointment, so he was not questioned Read more »

Primark vows to make all clothing from recycled or 'more sustainable' materials by 2030

The fast fashion giant also promised to halve emissions, but environmentalists fear the plans are too light on detail. Read more »

Energy watchdog warns on 'record' prices as two more household suppliers fail

Ofgem warns households that gas prices are likely to be "high for some time" as an energy crunch threatens to push up bills further for customers whose fixed tariff deals are expiring. Read more »

NARCL a game-changer for India's bad debt resolution

The banking sector in India has played a pivotal role in the growth and development of the economy. By mobilising deposits and facilitating seamless credit flows, the banking sector is ... Read more »

Damian Lewis recalls filming on the day of 9/11

The Billions star is raising money with BGC in remembrance of the colleagues who were killed during the 9/11 attacks. Read more »

UBS Principal Capital Asia sells IndusInd Bank's shares worth Rs 354 crore

(Image: PTI) UBS Principal Capital Asia Ltd on Thursday sold IndusInd Bank shares worth nearly Rs 354 crore through an open market transaction. Bulk deal data with the BSE showed ... Read more »

9/11 anniversary: City veteran reflects on loss of colleagues

Read more »

Why are there supply shortages in UK?

There is estimated to be a shortfall of around 100,000 lorry drivers - triggered by an exodus of foreign nationals during the pandemic and post-Brexit immigration rules, which is affecting stock levels in supermarkets and fast food chains. Read more »

'The upper reaches of society are going to have to pay' - Sorrell

Read more »

'You can't keep raising business taxes without consequences' - CBI

Read more »

'Inevitable' that prices will rise - Wagamama owner

Read more »

'Major job losses' on the way at travel firms

Read more »

Vacancies are at a record high: Which sectors have the biggest gaps to fill?

Official figures show which parts of the UK economy have the highest and lowest rate of vacancies across their workforces and where the gaps have opened up most quickly - with hospitality and transport among them. Read more »

Fears people will 'struggle to get Christmas presents for their children' amid supply chain woes

Sky's Paul Kelso writes that the government has delayed introducing Brexit customs checks to stop the current global supply chain squeeze becoming a crisis. Read more »

West Midlands 'developing a real cluster sector'

Read more »

M&S blames Brexit as it axes 11 French high street stores

The retailer said supply chain complexities under new trading rules now made it "near impossible" to serve fresh and chilled products to its customers in France to the expected standards. Read more »

Goldman boss credits Birmingham talent for investment

Read more »

Households urged to act on bills as fire adds to leap in power costs

As the £139 hike in the energy price cap prepares to take effect, families are being told time is running out to secure a fixed-price deal that will better protect them from what is likely to come. Read more »

China's tech regulator orders smart vehicle makers and telecom operators to enhance data and network security

China’s main technology industry regulator has urged telecommunications companies, internet of vehicles (IoV) manufacturers, and relevant service providers to ramp up data security, in a new regulatory push that could ... Read more »

Niti Aayog Vice Chairman emphasises need to reduce carbon footprint in urbanisation

Rajiv Kumar, Vice-Chairman of the NITI Aayog Niti Aayog Vice Chairman Rajiv Kumar on Thursday emphasised the need to reduce carbon footprint in urbanisation and said urban India will be ... Read more »