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Robinhood withdraws bank charter application

Robinhood withdraws bank charter application

Stock-trading app Robinhood has withdrawn its bank charter application with the Office of the Comptroller of the Currency.

The firm says it voluntarily withdrew the application, which was submitted earlier this year, with a spokesperson telling CNBC: "Robinhood will continue to focus on increasing participation in the financial system and challenging the industry to better serve everyone."

The Californian startup has seen huge take up since launching its free stock trading app in 2015, hitting a valuation of over $7 billion in its latest funding round.

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

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

With the bank charter application now off the table, the partnership model with FDIC-insured banks seems set to continue.

Comments: (1)

A Finextra member
A Finextra member 28 November, 2019, 09:56Be the first to give this comment the thumbs up 0 likes

That Sheriff Of Nottingham sticks his nose in everywhere !