Yu'ebao (Leftover Treasure), an Alibaba personal finance product, had 43.03 million users with aggregate deposits of 185.3 billion yuan ($30.4 billion) at the end of 2013. [Photo/IC]

Despite a dropping yield rate, Yu'ebao, China's popular online fund service backed by Alibaba Group Holding Ltd, saw its deposits more than double to 578.9 billion yuan ($93.15 billion) in 2014.

A report released on Thursday by TianHong Asset Management, which runs Yu'ebao with online payment tool Alipay, said that the number of users of the online wealth management service reached 185 million by the end of 2014.

Yu'ebao said that it has gained a large number of users in first-and-second-tier cities in China but there is a lot of potential in lower-tier cities and even rural areas that has yet to be tapped.

The so-called grassroots wealth management product, which was introduced in mid-2013 to make it easy for Alipay users to invest their idle cash in their Alipay accounts and receive a higher interest rate than typical savings bank deposits, is the first of its kind to combine the convenience of the Internet with the sophistication of finance.

Many Internet firms and traditional banks have followed Yu'ebao's example, launching similar services to lure deposits, leading to fierce competition in the market.