Stock Trading App Robinhood wants to Become a Bank

Robinhood stock trading app: A National Banking Charter is attractive to many financial tech companies but alas, it is very hard to get. That hasn’t stopped California-based stock trading app Robinhood from approaching regulators at the Office of Comptroller of the Currency (OCC) with an ambition to acquire the necessary licenses to allow them to receive a national banking charter, which would effectively class the platform as a bank. 

The idea is to become a more official banking platform, covering all bases from cryptocurrency to stocks and fiat accounts for its customers. Currently, Robinhood boasts a 4 million-strong user base who enjoy commission-free stock trading. In the last year, alongside equity investments, it introduced the ability to trade Bitcoin and Ethereum for users across 16 states. If the company can receive ‘bank’ status it could offer more services such as savings accounts to its customers and become a one-stop-shop for finance.

At present, Robinhood is registered with FINRA as a broker-dealer and is regulated by the Securities and Exchange Commission (SEC). If the company was to offer traditional banking services, it would join the ranks of several Fintech startups whose idea to stir people away from larger banks is reflective of current trends especially encouraged by those who trade in cryptocurrencies. Promises of higher interest rates, smoother and convenient user experience along with transparency is attractive to many potential clients.

But the regulations surrounding banking services are vast and complicated. Most startups that have been offering banking services are usually affiliated with an existing institution and haven’t actually acquired a banking license themselves. Licenses can in some cases take years to finalize.

Other companies who are said to also be registering as a national bank include Circle – a $3billion crypto finance company and the world-renowned crypto exchange Coinbase.

>>Crypto World Cup Day 8: Vitalik Buterin vs. Charlie Lee

Joseph Otting, Comptroller of the Currency recently stated: “Most Fintechs come to us because they have heard of this thing called a national banking charter that gives them pre-emption across state lines…when they come and they speak to us, and they understand what it really takes to be a bank, they kind of glaze over and often leave skid marks leaving the building.”

It seems the task is an undertaking not to be reckoned with. Will Robinhood succeed? or leave the OCC with its tail between its legs?

Featured Image: indexventures.com

Wall Street Insider Reveals His Secret To Blockchain Investing

How Much Do You Know About Cryptocurrency

New Crypto Millionaires Are Created Everyday!

2018 Is The Year Crypto Currency Millionaires Are Made

3 comments
  • Datherine

    What a pleasure to find someone who idefnities the issues so clearly http://hhlykbjalg.com [url=http://ibssqa.com]ibssqa[/url] [link=http://gwvmqldkrct.com]gwvmqldkrct[/link]

    Reply
  • Daysia

    That kind of <a href="http://gekfuxb.com">thniinkg</a> shows you're an expert

    Reply
  • Kellsie

    Ennhigteling the world, one helpful article at a time.

    Reply
Post a Comment
Your email address will not be published. Required fields are marked*