The Financial Bureau on the Mountaintop

The Yaochu Courtyard in Honghe Hani and Yi Autonomous Prefecture was the residence of the Yao family, a wealthy merchant family in southern Yunnan during the late Qing Dynasty and early Republic of China. Their financial bureau was a unique financial system built on the foundation of caravan trade. At the end of the 19th century, the Yao family rose to prominence by relying on the Yunnan-Vietnam Railway and border trade between China and Vietnam. They used a caravan network to transport goods such as tin from Gejiu and Pu'er tea to Southeast Asia, forming a cross-regional commercial chain. The core of the Yaochu Courtyard's financial bureau was a financing model of "goods in place of silver." Before the caravan set off, the caravan leader could obtain goods as principal from the courtyard based on their credit. After selling out the goods, they would return the principal and 30% of the profit. At the same time, a "risk-sharing fund" was established, with each caravan contributing 5% of its profits to a common fund used to compensate for unexpected losses and ensure the continuity of trade. In addition, the Yao family innovated a "tin-tea exchange" system. Merchants in Vietnam could exchange their tin mining proceeds for tea vouchers issued by the courtyard. These vouchers could be used to pick up goods in Yunnan tea plantations, achieving cross-border settlement. This system reached its peak between 1910 and 1937, with a circulation network covering 18 counties in Yunnan, Guangxi, and northern Vietnam, and an average annual turnover of over 200,000 taels of silver. After the Yunnan-Vietnam Railway was interrupted in 1938, the financial bureau disintegrated along with the decline of caravan trade. However, its risk-sharing mechanism and cross-border settlement model are still considered typical examples of private finance in modern Yunnan.