Waiting List for Robinhood’s Zero-Fee Trading App Is Opening to the UK
The co-CEO of Robinhood credits referrals by current customers as the “secret sauce” to why their app has been successful in the US already.
Robinhood is known for their fee-free trading, which they make available to consumers on their trading app, based in California. However, recent reports from CNBC show that this option will soon be coming to UK traders as well.
The Menlo Park-based platform is opening their waiting list now, even though the full launch of the product is not happening until next year. The Financial Conduct Authority granted broker authorization for Robinhood through the summertime, allowing them to launch in the country.
Wander Rutgers, the president of the UK business for Robinhood, spoke with CNBC in an interview, stating,
“We’re bringing the best of years of product development in the US to UK customers. Users can sign up for early access starting on Wednesday. We will aim to launch the product by early 2020, so expect to see customers having it in their hands in Q1 of next year.”
The UK has a fairly active and progressive fintech industry, and companies with app-based checking accounts like Monzo, Revolut, and Starling have been gaining momentum. In fact, Revolut recently decided to offer a no-fee share trading service. Much of this popularity can be credited to the referrals of current customers to friends and family. The tactic is being lauded as the “secret sauce” to the success in the US, according to co-founder and co-CEO Vlad Tenev of Robinhood. Tenev added,
“I think ultimately we recognize the U.K. is going to be a tough market. It’s a challenging market, not just because of the competitive landscape, but also the customers have discerning tastes, they’re quite sophisticated and there’s a long history of financial products here.”
While the offer that Robinhood is providing to traders is enticing, the platform will be competing with other brokers in the area, like Hargreaves Lansdown and Freetrade. However, Rutgers remarked that he doesn’t see the UK landscape as a “country for investors,” and is instead hoping to make this option more welcoming to millennials that find trading to be too costly or complicated for them.
Upon the launch of services, Robinhood is opting against charging foreign exchange fees, and it will cost as little as £1 to get started. Customers will have access to over 3,500 stocks in the US and 1,000 international shares. Some of the companies available to invest in include Nike, Amazon, Burberry, and Barclays.
Following a funding round worth $323 million, Robinhood has been valued at $7.6 billion this year so far. The launch of the UK trading app won’t be until next year.