After one year of launching the home improvement fund escrow service, Beiwo has successfully managed over 16,000 orders and 2.4 billion yuan in funds, ensuring their "safe landing".

The home decoration industry in China has entered a market scale of trillions of yuan and is showing a structural growth trend. According to the data from "The White Paper on China's Home Decoration Industry in 2024" by iResearch, in the segmented fields of the home decoration industry in 2024, as the mainstream model, the overall decoration service has reached a market scale of 586 billion yuan, accounting for 42.3% of the total industry scale, becoming the service type with the highest proportion. The construction service follows closely, accounting for about 28.7% with a market scale of about 398 billion yuan. The design service and soft decoration service account for 12.1% and 10.5% of the market share respectively, corresponding to scales of 167.5 billion yuan and 145.3 billion yuan.

However, while the demand for home decoration is constantly upgrading and being released, some risks and problems closely related to the healthy development of the industry and the consumer experience need to be solved urgently.

The prepaid payment model is a common practice in the home decoration industry and has become the most core source of capital risk for users. On the one hand, some home decoration enterprises require users to prepay 30% - 80% of the payment, and the funds directly enter the enterprise's operating account. If the enterprise's capital chain breaks or it maliciously embezzles the funds, users will face the dilemma of losing both money and goods. Such disputes are particularly common among small and medium - sized decoration enterprises. Data from the Beijing Consumers Association shows that the proportion of complaints caused by fund misappropriation and running away with money in the home decoration field has remained high for a long time.

On the other hand, the consumption traps of "low - price attracting customers + malicious additional items" are common. Some enterprises attract users to sign contracts with quotes far lower than the market average price. After signing the contract, they require additional fees in the name of "omitted items", "material upgrade", "process change", etc. The additional amount often accounts for 20% - 50% of the original contract amount. If users do not accept, they will face the risk of construction suspension or breach of contract.

How can consumers' rights be protected, and at the same time, how can the internal driving force for service and quality improvement be found from the models of home decoration enterprises?

Against this background, in June 2024, Beiwo took the lead in launching a pilot service for fund custody in the home decoration industry and fully rolled it out in November of the same year.

The home decoration fund custody project is a "pay after decoration" service launched in response to the customer risks caused by the traditional "pay first, then decorate" model in the home decoration market, especially the capital risk caused by decoration companies running away with money.

Specifically, Beiwo cooperates with a third - party bank. In the process of the home decoration fund custody service model, the decoration payments paid by consumers in batches will be first frozen in their own bank accounts. Then, after the key decoration links of "hydropower acceptance, basic decoration acceptance, and final acceptance" are completed, the funds will be unfrozen to the home decoration company's account to ensure the safety of funds and that consumers have the actual power to evaluate the home decoration service.

Currently, the cooperative bank for Beiwo's fund custody service is China CITIC Bank. Relying on China CITIC Bank's professional risk control system, Beike has established a complete mechanism of "node acceptance, two - way confirmation, and bank payment": The owner's decoration funds are directly deposited into the bank's special custody account. Only after the project nodes agreed in the contract are completed and confirmed and accepted by the owner can the corresponding proportion of payment be applied to the bank.

Liang Lei, the general manager of the north - and - north region of Beike's overall decoration, revealed that since the launch of Beiwo's fund custody service one year ago, it has served more than 16,000 families in total, covering more than 4,500 communities, ensuring a capital scale of more than 2.4 billion yuan, with a service coverage rate exceeding 95% and a punctual unfreezing rate exceeding 96%.

The feedback from consumers is also very obvious. Zheng Shenzhen, the general manager of the external relations and development center of Beike's overall decoration, introduced, "In 2023, we had concerns. We were worried that this service would bring pressure to the industry and that the fund custody model would pose challenges to the enterprise's cash flow. But in 2024, consumers' demand for fund safety became stronger, which forced us to firmly launch this service. Facts have proved that in one year, the number of relevant customer complaints has been reduced by half compared with last year."

"The fund custody systemically separates the ownership and the right of use," said Jia Dan, the deputy general manager of the Beijing Branch of China CITIC Bank. The bank conducts full - process supervision of the funds through mature risk control technology to ensure that the funds are used for specific purposes. At the same time, it implements the principle of "separation of interest and principal", and the interest generated during the custody period belongs to the consumers. This design completely eliminates the risk of fund misappropriation and truly realizes the ideal state of "money follows the progress, and payment is made according to the quality", returning the service evaluation right and fund control right to the consumers.

The innovation of the "fund custody" model will promote the transformation of the home decoration industry from "price competition" to "value competition". As more enterprises join the standardized ranks, the trust crisis that has long troubled the industry is expected to be fundamentally alleviated.