Robinhood Markets Inc (NASDAQ: HOOD) is now paying customers 1% curiosity for holding their uninvested cash on the app.
What Occurred: The net brokerage introduced the brand new function on Tuesday to “eligible” customers of the app. The rate of interest eclipses the 0.06% offered by the common U.S. financial savings account.
Robinhood says forward of in the present day’s announcement, its brokerage money sweep program provided an rate of interest of 0.5% and was solely accessible to clients enrolled in Money Administration. Any person who’s already enrolled in that program shall be mechanically transitioned into the brand new brokerage money sweep program with their rate of interest growing to 1% resulting from increased charges accessible out there.
Additionally Learn: Robinhood Permits Customers To Lend Inventory
How It Works: Prospects who decide into the brokerage money sweep can have their uninvested account money mechanically “swept,” or moved, into deposit accounts at a community of six program banks.
Robinhood says money deposited to those banks shall be coated by FDIC insurance coverage as much as a complete most of $1.25 million. These banks pays curiosity on the swept money, and clients will obtain an APY of 1% as of Could 10.
Tuesday’s announcement comes after Robinhood final week mentioned it is going to start permitting customers to earn earnings on the shares they personal by lending out their shares.
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