Robinhood is getting nearer to changing into a full-fledged monetary service. On Wednesday, the corporate introduced a completely on-line banking platform that can provide checking and financial savings accounts to Robinhood Gold subscribers when it launches this fall.
The platform, known as Robinhood Banking, will let customers entry their accounts, in addition to ship and obtain cash via the Robinhood Credit Card app. It even makes an attempt to make up for not having a bodily location by having bodily money “delivered on-demand proper to the doorstep.” There nonetheless aren’t many particulars about how this can work, however Robinhood says “protection varies based mostly on geographic location.”
Robinhood Banking guarantees a 4 p.c annual share yield (APY) and FDIC insurance coverage of as much as $2.5 million on accounts. The firm notes that because it’s not an FDIC-insured financial institution, it’s providing “pass-through” insurance coverage offered by FDIC member Coastal Community Bank. Pass-through insurance coverage includes insuring folks’s funds by holding them “at an FDIC-insured financial institution via a 3rd celebration,” in keeping with the FDIC.
The service will provide particular person and joint banking accounts at launch, together with choices to create kids’s accounts. Deepak Rao, Robinhood Money’s normal supervisor and vice chairman, says the platform is designed to “clear up lots of the challenges offered by legacy banks.”
In addition to a checking account, Robinhood is launching a brand new wealth administration platform known as Robinhood Strategies. It will provide entry to a mixture of single shares and exchange-traded funds (ETFs), which “are actively managed to supply entry to extra alternatives.” The funds have a 0.25 p.c annual administration price, with a yearly cap of $250 for Robinhood Gold members.
Robinhood Strategies is obtainable to Robinhood Gold members as we speak, nevertheless it’s coming to all prospects subsequent month. Robinhood Gold is the corporate’s $5 per 30 days (or $50 per yr) subscription program that gives options like margin investing and bigger immediate deposits.
Later this yr, Robinhood additionally plans to launch an AI-powered funding software known as Cortex for Gold subscribers. It will present analyses and insights concerning the present market, akin to why a specific inventory goes up or down, in addition to which shares to think about buying and selling.
Over the years, Robinhood has remodeled itself from a easy investing app into an all-in-one hub for customers’ funds. The firm launched a bank card in 2024 as a part of efforts to encourage folks to maintain their cash inside the widening Robinhood ecosystem, the place they’ll now have the ability to retailer and withdraw money to make investments on the app, too.
