Banks in China have launched an array of online products for wealth management, as they attempt to compete against Alibaba, the giant of e-commerce that has a very popular investing platform online called Yu’e Bao that pays its users up to 17 times the usual standard interest rate.

At the start of the year, several large banks, including the Bank of Communications and the Industrial and Commercial Bank of China started promoting wealth management and investment services of their own to attract disposable cash.

ICBC and ICBC Credit Suisse Asset Management partnered and launched a service for mobile investing that offers a return of about 6% per year.

Just a single Yuan about 16 cents can be deposited through phones and money can be withdrawn any time an account holder wishes.

ICBC’s product is like that of Yu’e Bao, which also has a minimum threshold for investing of just one Yuan. The definition of Yu’e Bao’s is leftover treasure, and lets its users transfer cash from their bank to the payment accounts operated by Alibaba and then on to the Yu’e Bao account with a few clicks of the mouse or taps on a tablet.

The site has become a huge hit amongst online shoppers in China. The platform released a report that said it had as many as 49 million monthly users and deposits of $41 billion.

Tianhong Asset Management is the fund manager partnering with Alibaba and is the largest fund company located in China.

The popularity of Yu’e Bao has created great pressure on banks in China. Very quickly, the banks are beginning to lose some of the household deposits that are said to be over $7.4 trillion. The Central Bank of China said savings for households dropped by $148 billion during October of 2013 as account holders started switching money to wealth management accounts.

Some believe the popularity of Yu’e Bao will dwindle inside China as the central government liberalizes its deposit rates. The Central Bank of China already scrapped its floor with its borrowing costs last July. However, with the controls the Central Bank places on banks, it is hard for them to give better returns on deposits.

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