Robinhood releases savings product

Robinhood releases savings product

Stock trading outfit Robinhood has launched the successor to its doomed checking account, Robinhood Cash Management, a savings product offering 2.05% interest combined with an associated debit card.

Robinhood's first step into the banking business last December was a PR disaster, after the company hastily backtracked on the launch of its Checking & Savings account following a backlash from regulatory bodies.

"We believe our financial system should work for you and do more for your money," says the firm in a statement. "To help get us there, we announced plans in December to launch a new product. We made mistakes with that announcement, which led us to hit the reset button and start over from scratch."

The Cash Management account offers much the same benefits and branding as the aborted Checking & Savings product, but on this occasion offers FDIC insurance on uninvested cash in customer accounts which will be held at six licenced banks.

The Mastercard debit card will enable users to withdraw and spend money from their brokerage account, with the unspent balance swept into the FDIC-insured partner banks via Promontory’s debit suite system. Those banks include Wells Fargo, HSBC, Goldman Sachs, Citibank, U.S. Bank and Bank of Baroda.

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