Since the start of 2026, trust institutions including Zhongyuan Trust, Chang'an Trust, Suzhou Trust, Zijin Trust, Yunnan Trust, Huabao Trust, Shanxi Trust, and Jiangsu Trust have rolled out service trusts focused on grassroots governance, covering scenarios such as property management, community public revenue, special-needs elderly care, and community governance.

According to the China Trust Industry Association's evaluation of the sector's first half of 2025, administrative management service trusts reached 2.80 trillion yuan by the end of June 2025, while asset service trusts totaled 11.20 trillion yuan. Service trusts are shifting from a peripheral business to the forefront of industry transformation.

Public Funds Transferred into Dedicated Trust Accounts

It has been learned that Zhongyuan Trust launched Henan Province's first batch of property management service trusts, covering multiple residential communities in Zhengzhou's Guancheng and Jinshui districts. Homeowners act as settlers, with property fees and community public revenue placed into a trust, isolating these funds from the property company's own assets. The trust system connects to Zhengzhou's local urban service platform, allowing homeowners to check income and expenditure details at any time.

Chang'an Trust expanded its "Anju No.1" property service trust to Baoji, where all community property fees and parking public revenue are pooled into a dedicated trust account. Street offices and community neighborhood committees act as supervisors, while community property management committees serve as regulators conducting dual-level expenditure reviews. Chang'an Trust fully discloses trust fund income and expenditures on a monthly basis.

Suzhou Trust signed an agreement with Fengqiao Street in Suzhou High-tech Zone, implementing trust custody for three commercial residential communities and 23 resettlement housing communities. All public revenue and resettlement community maintenance funds are placed under dedicated trust account management, with every transaction traceable and fully documented.

Zijin Trust launched the public revenue service trust for Lushan Community in Nanyuan Street, Jianye District, Nanjing, marking the city's first community public revenue service trust. The Lushan Community Neighborhood Committee serves as the settlor, with partial revenue from low-cost community services flowing into the trust account, earmarked for local public welfare services and resident benefit programs.

Yunnan Trust launched Yunnan Province's first property management service trust at the Power Line Equipment Factory residential area in Xishan District, Kunming. Community homeowners act as settlers, Yunnan Trust serves as trustee, and ICBC Kunming Branch acts as custodian bank. Property fees and public revenue are all collected into the trust account, with the trustee and custodian bank forming dual risk controls.

Huabao Trust completed the first "Xile Ankang" special-needs elderly care service trust, with a nearly 70-year-old elderly person living alone as the settlor. The individual established a service trust for personal emergency medical funds, incorporating a designated manager mechanism: when conscious, the elderly person issues payment instructions personally; in cases of sudden illness with loss of consciousness, the designated manager can apply for emergency medical fund disbursement using hospital diagnostic certificates.

Shanxi Trust launched the public affairs administrative management service trust for Xincheng Community in Jinyuan Street, Taiyuan, bringing community public funds under trust account management with community and resident representative oversight, ensuring fund isolation and expenditure traceability.

Jiangsu Trust, in collaboration with Nanjing Shicheng Notary Office, established the "Jiangsu Trust Shicheng Shanshan No.1" administrative management service trust in Nanjing's old city area, focusing on fund management for community-guarded elderly individuals. The notary office verifies the true intent of the parties involved, while Jiangsu Trust handles dedicated custody management of guardianship funds, ensuring designated use and regular disclosure.

Institutional Advantages Overcome "Person-Managed" Dilemmas

"The dense rollout of grassroots governance service trusts this year is essentially the result of simultaneous forces from both the 'institutional supply' and 'governance demand' sides," said Zeng Gang, president of Tianfu Liyan Financial Research Institute, in an interview. He noted that the pain points on the demand side are clear: grassroots governance has long faced the common problem of public funds being "managed by people rather than by institutions." Large amounts of dormant funds such as community public revenue, property fees, and elderly support funds remain outside regulatory oversight, with opaque accounts and unrestricted withdrawals, frequently triggering misappropriation, disputes, and even crises of trust.

The trust system on the supply side precisely addresses these issues. Zeng further explained that property independence creates a "fund island" with risk isolation once public revenue and elderly care funds are placed into a trust, unaffected by the custodian's or trustee's own debts or bankruptcy. Trust documents can pre-agree on fund usage, payment conditions, and supervision mechanisms, transforming "relationship-based management" into "rule-based governance."

"It can be said that behind the 2.8 trillion yuan scale lies the irreplaceable institutional value that trust licenses have found in low-margin business, which is also a rare 'genuine demand' business in the industry's return-to-origin transition," he added.

Zhou Ping, a special lecturer at the Trust Industry Association, told reporters that the rapid expansion of grassroots governance service trusts results from the combined drivers of practical grassroots governance demands, regulatory institutional supply, and industry transformation. The long-standing pain points of chaotic community public fund accounts, unclear rights and responsibilities, and missing supervision require independent third-party custody tools. The three-category classification rules define the business boundaries for administrative management service trusts, providing institutional support. Combined with the inherent need for trust industry transformation, institutions have begun proactively exploring livelihood scenarios for fiduciary services.

Compared with ordinary custody, she believes the advantages of the trust system are concentrated in three aspects: first, property independence and risk isolation, as trust property is independent of property companies, owners' committees, and trust companies' own assets, avoiding risks of fund freezing and misappropriation; second, trust system regulations can embed budget reviews, payment conditions, multi-party supervision, and information disclosure, solving the problem of opaque funds; third, flexible architecture can incorporate street offices, owners' committees, and notary institutions into the governance structure, achieving separation of operational, financial, and supervisory responsibilities suited to diverse grassroots scenarios.

Constraints on Scaled Replication

Despite the continuous expansion of application scenarios, the scaled replication of such businesses still faces multiple practical constraints. Zhou Ping told reporters that constraints mainly come from four areas: some communities have ineffective owners' committees, with uneven foundations for coordination among property companies and street offices, creating resistance to adjustments in interest patterns; single-project scale is small, but the rigid costs of solution development and ongoing operational communication are high, resulting in cost-benefit mismatches; the industry has not yet formed unified business standards, with significant regional practice differences making cross-regional replication difficult; and grassroots stakeholders have insufficient awareness of trust tools, leading to high upfront communication costs.

She suggested that balancing inclusivity with commercial sustainability requires differentiated strategies. For old residential communities and safety-net guardianship projects, fiscal subsidies should be pursued; for commercial community projects, reasonable fiduciary service fees should be charged. Standardizing contracts and processes can reduce customization costs, while bundling multiple projects within a region for operations can enhance overall returns through scenario clusters. At the same time, rights and responsibility boundaries should be clarified, with government and community entities handling governance coordination while trusts focus on fund custody management, without placing all governance responsibilities on trusts.

Zeng Gang proposed two implementation paths. In his view, to balance the inclusive nature with commercial sustainability, one path is "volume-based pricing" and "ecosystem operation"—reducing marginal costs through regional batch replication while using service trusts as customer acquisition entry points, deriving high value-added businesses such as wealth management, family trusts, and elderly care finance. Another path is securing government service procurement or fiscal subsidies to socialize some public governance costs rather than relying entirely on trust companies to profit independently.

Service Trusts Becoming the Second Growth Engine

China Trust Industry Association data shows that as of the end of June 2025, asset service trusts totaled 11.20 trillion yuan. Among these, wealth management service trusts reached 4.37 trillion yuan, becoming the largest segment of asset service trusts; administrative management service trusts reached 2.80 trillion yuan; risk disposal service trusts reached 2.60 trillion yuan; and asset securitization service trusts reached 1.43 trillion yuan.

Under the "three-category" policy, asset management trusts and asset service trusts have replaced the traditional "financing trust + channel trust" model, becoming the dominant business model driving the current round of trust asset growth. In the first half of 2025, based on capital trust statistics, asset management trust balances were approximately 24.43 trillion yuan, accounting for 75.33% of total trust assets; based on non-capital trust statistics, asset service trust balances were at least 8 trillion yuan, accounting for 24.67%, making asset service trusts the second growth engine.

From the perspective of application scenarios, asset service trusts now cover all types including wealth management service trusts, administrative management service trusts, risk disposal service trusts, and new-type asset service trusts, with the trust industry's unique wealth management and social service functions continuously strengthening.

Institutional constraints are also easing. Since 2025, Beijing, Shanghai, Guangzhou, Xiamen, Tianjin and other places have piloted real estate trust property registration and equity trust property registration, clarifying trust registration paths for real estate and equity. Asset service trusts, particularly wealth management service trusts, are expected to achieve better and faster development, forming valuable business models and becoming growth engines that contribute both scale and performance.

"Looking solely at current profit contributions, grassroots governance service trusts indeed 'don't make money or even lose money,' which is also where internal industry debate is most intense," Zeng admitted. "But if we take a longer view, the value of such businesses cannot be measured by short-term fee rates."

In his view, these businesses are low-cost channels for trust companies to accumulate "trustee reputation" and government-enterprise social relationships. Today's low-profit service trusts may be the "incubator" for future family trust and will trust clients.

Zeng emphasized that against the backdrop of continued regulatory reductions in financing trusts and channel businesses, the industry must find new growth points that reflect the fundamental positioning of "entrusted by others, loyal to others" and gain social recognition. Grassroots governance trusts are precisely the trust form closest to ordinary people's lives and most easily understood and trusted by the public. They carry not only commercial value but also strategic assets for the trust industry to reshape its social image and secure long-term policy support and institutional space.

"In the short term, we should not use ROE to harshly judge such businesses but should regard them as 'strategic investments' during the transition period," Zhou Ping held a similar view. She believes that grassroots governance trusts have limited short-term profitability, and one should not simply look at current book returns. The commercial value is more reflected in the long term: promoting trust services to expand from high-net-worth clientele to ordinary residents, embedding into community scenarios, and channeling traffic to family service trusts and elderly care trusts; accumulating differentiated service capabilities in account management and multi-party coordination through engagement with government and communities, building institutional reputation and government-enterprise cooperation foundations.

"From an industry transformation perspective, this type of business is the practice of trusts returning to their fiduciary origins," she further pointed out. It breaks away from traditional financing logic, applying trustee functions such as custody, supervision, and interest coordination to livelihood scenarios, expanding the business landscape of asset service trusts, enriching the connotation of the second growth curve, and changing the market's entrenched impression of trusts as mere wealth management tools, driving the industry's transformation toward comprehensive fiduciary service providers.

Currently, grassroots governance service trusts have limited profit contributions, and the industry generally regards them as strategic investments during the transition period. In the future, as standardization improves and institutional supporting mechanisms are perfected, such businesses are expected to evolve from scale engines to value engines. China Net Finance will continue to track the subsequent progress of trust companies' grassroots governance service trusts.