The company hopes to make these new offerings available to some of its 6 million plus users.
U.s based Robinhood will now offer checking and savings accounts to its U.S customers. Although the company is widely known for its stock and cryptocurrency trading platforms, there had been talks, for months, of the Menlo Park-based firm's desire to enter the heavily-regulated consumer banking space.
“Currently, traditional checking and savings accounts cost more for people who make less, are riddled with unfair and hidden fees, and earn you minimal returns on your savings. We believe you should earn more on your money, and shouldn’t be charged fees to access it,” the company’s blog reads.
The company hopes to make these new offerings available to some of its 6 million plus users. New savings and checking accounts obtained on the company's platform will come with an impressive 3% interest earned on both types of accounts.
Customers will have access to 7500 ATM's via a linked personalized debit card, issued by the company.
Staying true to their model of low to no-cost services, customers will not be charged a fee for ATM withdrawals. ATM location information can be accessed on the Robinhood mobile app.
Robinhood does not have a Bank Charter yet, limiting the firm's ability to make extensive investments with customer deposits. The startup, however, is a licensed broker-dealer, and a member of the Investor Protection Corporation, allowing it to protect cash accounts up to $250,000.
The company hopes to invest customer deposits in safe, low interest bearing assets like US Treasury bonds and earn fees from debit card transactions.