Robinhood is expanding its banking abilities by launching a full-scale banking platform, Robinhood Banking, which will be available only to its Gold subscribers later this year. The new service will provide a personal banking experience with independent checking and savings accounts with luxury features. The platform will allow customers to manage accounts and transfer funds through the Robinhood Credit Card app, which will be the master banking app for all Robinhood financial services.
One of the coolest features of Robinhood Banking is the ability to deliver physical cash directly to customers’ doorsteps upon request, bypassing ATMs. This service is a part of an umbrella effort in solving the issue presented by mainstream banks, one of which includes convenience and availability. On-demand cash delivery is just one such aspect that belongs to a collection of high-class privileges that additionally include access to upscale events like the Met Gala, Oscars, F1 Monaco Grand Prix, and The Masters. Also on offer will be private jet flights, global private drivers, luxury helicopter flights, and members’ resorts.
Robinhood Banking will offer a high 4% annual percentage yield (APY) on its savings accounts, significantly above the national average. The site will also offer FDIC insurance protection of up to $2.5 million per account, although Robinhood itself is not an FDIC-insured bank. Instead, it has a relationship with Coastal Community Bank, which is an FDIC member, to offer “pass-through” insurance.
The company will go live with individual and joint checking accounts, and also the feature of opening a child’s account. The child’s accounts will include spending limits and allowance features embedded within them, so that families can easily manage their budget. The customer will be provided with a debit Mastercard, and the platform will be able to transfer money across over 100 currencies, transfer money worldwide, and between Robinhood accounts instantly.
The launch of Robinhood Banking is one aspect of a larger strategy by the company to move beyond trading into areas historically dominated by the wealthy. In addition to Robinhood Banking, the company is also introducing Robinhood Strategies, a wealth management product that will offer customized investment advice to its customers. The service is live today for Gold members and will be available to all customers in April.
Robinhood’s foray into private banking and wealth management is an indication of an increasing demand by retail investors for professional financial advice. The firm expects to provide an end-to-end financial experience that includes cutting-edge tools and services typically offered to high-net-worth clients. By offering such services, Robinhood expects to democratize private banking and wealth management and make them affordable to more users.
