Can You Spare Half a Yuan - For Surgery? | EMQQ

01 July 2019

Ant Financial, through its online apps and appeal to consumers and small businesses, has already proven to be a disruptor in the financial industry.  Now, it is looking to be a disruptor in the health insurance industry.  By pooling very small contribution from a large number of subscribers, the company has been able to provide costly medical treatment for many in China.

While Ant is not a public company, some access to the company is available through Alibaba which has a 33% stake, according to the Financial Times.[1]

Crowdfunding for Health Insurance 

During October 2018, Ant Financial rolled out its Ziang Hu Bao “mutual protection” play for users of Alipay which so far has signed up 50 million participants, according to the Wall Street Journal,[2]  which when on to note that the plan provides for lump-sum payouts for 100 critical injuries or diseases.  Each participant is required to contribute a small amount for each claim.  The article noted that 18 payouts were made during April 2019 and the amount that each participant had to contribute was 0.01 yuan per claim.

Whoever joins Ant’s platform is eligible for one-time cash payouts.  Payouts are determined based on the facts of the cases submitted. The total payouts are divided among the participants with that sum determining the twice-monthly premium each member must pay, rather than the traditional model of paying premiums up-front for the promise of future protection, according to DigFin.[3]  Ant charges an 8% administrative charge from each payout.

Additionally, Ant has edibility requirements, according to DigFin. First, a member must have a credit score of at least 650 which is seen as a proxy that the member is an active consumer in Alibaba’s ecommerce platform and pays his bill on time. Payments are also deducted from a user’s Alipay account and the platform aims to target Alipay’s user base. Second, the member must be under 59 years old and have no pre-existing conditions.

Ant financial is targeting 300 million participants in the next two years, according to the Wall Street Journal. The company is also looking to roll out the platform in other emerging markets countries.

Others Joining the Fray 

Ant is one of about a dozen private startups in China providing crowdfunding platforms.  Even Chinese ride-hailing giant Didi Chuxing launched a similar product, according to the Wall Street Journal.

And Ant’s platform is not the first. Tencent launched a similar platform – Shuidi Huzhu - three years ago and now has 75 million members, according to DigFin.

Not Insurance

Companies providing crowdfunding in the healthcare space are careful to stress that these platforms are not insurance products to avoid regulations.  Instead, the platforms rest on the premise that small amounts of money can be pooled into large sums.  Thus, the platforms call themselves “mutual aid” to identify it as a financial, not a financial product.


Ant Financial is looking to further disrupt the financial services sector in China.  Its current platform looks to provide payments for medical procedures by pooling small payments from a large base of participants.  Unlike traditional insurance where premiums are paid upfront for future protection, bi-monthly payments are made by participants to cover previous payments.  Such mutual-aid platforms may help to provide insurance for a large swath of the Chinese population which may not have access to such previously.

Find out more about the Emerging Markets Internet and Ecommerce UCITS ETF (EMQQ)

As of 28th June 2019, the Emerging Markets Internet and Ecommerce UCITS ETF (EMQQ) held 7.84% of its weight in Alibaba Group. 

Read our EMQQ Whitepaper "The Great Confluence" here

Article Date: 1st July 2019.


Sign Up to Insights

Tell us how we can help