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Last Updated: 2 years ago

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Online dealer Robinhood is upping the rate of interest it pays to Gold members on uninvested money held in brokerage accounts.

Through Robinhood’s brokerage money sweep program, Gold prospects now earn 3% curiosity on uninvested funds retained in accounts, in comparison with 1.5% for non-gold customers, in accordance with a press release on Monday (Sept. 26).

With the brand new larger price, Robinhood Gold members can earn 23 occasions extra in curiosity in comparison with the nationwide common financial savings price of 0.13%, primarily based on knowledge from Bankrate as of Sept. 14.

See additionally: CE100 Index Plunges 7.2% as Higher Interest Rates Cloud Spending Outlook

Robinhood overhauled its brokerage money sweep program in May and has since skilled “strong adoption from our Gold users, who currently have about $750 million enrolled in cash sweeps,” per the discharge.

All money sweep balances at the moment are incomes 3% curiosity with the curiosity compounding every day, in accordance with the discharge. Monthly curiosity paid by program banks could be tracked by customers within the Robinhood app.

Read extra: Robinhood Seeks Fresh Following as Client Rosters, Revenue Plummet

The new larger rate of interest is on prime of Gold buyer perks like bigger on the spot deposits, entry to Morningstar analysis, Level II market knowledge from Nasdaq, and entry to margin investing at 5.75% curiosity for eligible customers, with the primary $1,000 of margin included. Non-gold eligible prospects have entry to a margin rate of interest of 9.75%.

Customers who’re a part of the money sweep program have their uninvested brokerage funds mechanically moved into deposit accounts at a community of six program banks. Funds are coated by FDIC insurance coverage as much as a “total maximum of $1.5 million, up to $250,000 per program bank, inclusive of deposits customers may already hold at the bank in the same ownership capacity,” in accordance with the discharge.

Robinhood Gold prices $5 a month; new prospects get a free 30-day trial. Customers not enrolled in Robinhood Gold can nonetheless earn 1.5% curiosity for all uninvested brokerage money as soon as they enroll within the money sweep program.

New PYMNTS Study: How Consumers Use Digital Banks

A PYMNTS survey of two,124 US customers exhibits that whereas two-thirds of customers have used FinTechs for some facet of banking providers, simply 9.3% name them their major financial institution.

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https://www.pymnts.com/cbdc/2022/3-reasons-a-digital-dollar-is-still-a-long-way-off/partial/

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