| In recent two years, the internet finance has rapidly penetrated into and tremendously influenced the traditional financial field. Moreover, it tends to replace the position of traditional finance. The internet finance mode mainly includes the third party payment platform, P2P microfinance network mode, crowdfunding mode, internet banking mode, internet financial portal mode, virtual electronic currency mode, etc. The efficiency of resource allocation can be achieved through these modes as with direct or indirect financing. It not only promotes economic growth, but also substantially reduces transaction cost. Above all, the internet finance is a kind of financial mode that is managed and controlled democratically and non-professionally. It brings big changes to the traditional financial field with the characteristics of weakened division of labor and professionalization. The common people have equitable access to participate in and have reaped tremendous benefits from current conditions.As a "masterpiece" of fund industry and Alipay which is the well-known domestic e-commerce platform, Yu E Bao has become the constant focus of public opinion. The cooperation mode between Alipay and TianHong Income Box Money Market Fund is specifically as follows:Alipay is in charge of launching Yu E Bao that is used for cash generation for its clients. And its clients’subscription for the fund is tacitly approved when money is transferred to "Yu E Bao". Then they involuntarily become the income beneficiary of the monetary fund. Transferring money from Yu E Bao or paying directly from it is equivalent to the redemption of the fund shares. Yu E Bao has turned the online consumers into its investors by providing lower investment thresholds, more flexible realization and a more considerable high-yield since it was launched. At present, over81million people use Yu E Bao which seems to become another blue ocean for the investors. The development opportunities of Yu E Bao are closely related to the current direction of China’s financial reform. Meanwhile, the combination of Yu E Bao and mobile payment applications can realize the mobile financial management of monetary fund anytime and anywhere, which is a big advantage. All the banks, funds and securities companies of the traditional financial mode should be grateful to Yu E Bao because of the revolutionary changes it has brought about. The Internetization of the traditional finance is actually the expansion of the traditional financial services, which can greatly reduce the cost of financial services and significantly improve its efficiency. However, as an Internet financial product, the yield rate of Yu E Bao is also inevitably determined by the interest rate level of marketization ultimately, so its financial risk should not be ignored. Yu E Bao has risks. We can compare it to a bucket made of five boards, of which the shortest determines its security level. The first board is the credit risk of Yu E Bao itself. The second refers to its operating risk, the third stands for its liquidity risk, the fourth represents its market risk, and the fifth is its legal risk. Some risks of fund investment can be controlled within a bearable scope by putting risk management the first of portfolio management instead of merely pursuing high returns, analyzing big data via taking advantage of Alipay’s data, and following up the credit analysis regularly, etc.The innovation of this paper lies in the subject investigated, which is the most talked about topic, the Internet-enabled finance. In this paper, the author focuses on analyzing the risks of the Internet financial product, i.e. Yu E Bao, and makes some practically significant proposals in terms of strengthening the preventive measures against the Internet financial risks, such as investing legislative efforts on the Internet finance, building flexible regulatory organizations, establishing the mode of self-discipline of the company itself, mutual-discipline within the industry and heteronomy from the regulators, etc. |
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