Two online brokerage services giving Chinese investors access to global stock markets announced Tuesday that they will pull their apps from mainland app stores this week under tightened regulatory scrutiny.

U.S.-listed UP Fintech Holding, known as Tiger Brokers, said it will remove its app on Thursday, while Futu said it will do the same on Friday. 

Both companies said that existing clients won’t be affected by the change, although they won’t be able to inject new capital. Online, Chinese investors also seem relatively unfazed by the announcements. 

“The app is not banned and it will continue to be updated,” said a user on Snowball, a social network and information portal for investors in China. Users pointed out that the apps are still downloadable on the companies’ official websites, or can be downloaded using VPNs to access app stores of other countries.  

In December, the China Securities Regulatory Commission ordered the two companies to rectify their “illegal operations” and stop allowing new users on the Chinese mainland to sign up. 

The two companies are among the few channels for Chinese retail investors to invest in overseas stock markets such as the U.S., despite not being officially licensed to do so. The Chinese government adopted a laissez-faire attitude toward such services prior to 2019, when it began reigning in the sector. 

Demand for access to U.S. stock markets peaked around 2018 as major Chinese tech companies listed there, before trade tension between the two countries and the prospect of companies delisting cooled the trend.  

In recent years, the Chinese government has tightened its regulatory scrutiny of the country’s tech giants including Alibaba and Tencent, one of Futu’s major investors. Ride-hailing giant Didi saw its apps removed from mainland app stores in 2021 after running afoul of government regulations. 

For Shanghai-based office worker Rachel Zhu, the wider investment environment is more important than the loss of the apps. She already closed her Tiger Brokers account last September after losing most of her gains from investing in the U.S. amid a market downturn.

“On the one hand, the government has taken a stricter stance on cross-border brokerage services since last year. On the other hand, the overseas stock market is just too risky for me as a retail investor,” Zhu told Sixth Tone.

Adopting a more cautious investment approach, she now deposits most of her savings in banks. “I also invested a small proportion of my savings in funds. I’m losing money on it, however. I’m spending less now,” she said.

Editor: Vincent Chow. 

(Header image: IC)