Deposits in Baidu Wallet, the wealth management service run by China’s leading search engine and web portal, reached its investment limit of one billion yuan (HK$1.27 billion) in less than five hours after it launched on Monday.
“Please stay tuned for future products,” the company said on its Sina Weibo microblog as it announced a temporary stop on offerings on Monday afternoon.
Baidu, often called China’s equivalent to Google, is the latest tech giant to use its online resources to offer financial services, challenging investment products offered by the traditional banking sector.
Demand was so high that complaints about the website being inaccessible circulated online. Baidu Wallet found an initial 120,000 buyers, company spokesman Kaiser Kuo wrote in an email. On average, these initial investors put 8,333.33 yuan into the new financial service, which plans to achieve eight per cent returns on investment annually. The minimum investment in the portfolio of bank deposits and bonds was one yuan.
The tech company’s new product is widely seen as a challenge to Alibaba’s online personal finance service Yu’ebao, which has collected 55.7 billion yuan since its launch in June, according to a statement by Tian Hong Asset Management, Yu’ebao’s asset manager, last week. The company predicted Yu’ebao assets to exceed 100 billion yuan by the year’s end, with an additional 500 million yuan on average flowing in every day.
The company said on Monday that the service already had more than 13 million customers. Its annualised return on investment was 4.7 per cent, according to its website.
Earlier this month, Alibaba, the company also controlling China’s largest online marketplace Taobao, acquired a majority hold in Tian Hong.
Baidu, listed on the NASDAQ stock-exchange, is scheduled to report its third-quarter results later on Tuesday.