Trading app Robinhood withholds margin investing in the UK

Wednesday 20 March 2024 14:09 CET | News

US-based trading app Robinhood has put on hold its plan to allow margin investing to UK-based consumers until further talks with regulators, as it launches in the UK.


Robinhood, which launched its UK arm on March 19th, 2024, had planned to offer margin investing, a risky form of trading in which customers borrow money to make bigger trades.

Initially, a page about margin investing on Robinhood's UK website said that the company charged 12% interest on the loans and could offer the product due to a ‘regulatory exemption’ which meant Robinhood UK was not required to assess customers to see if margin investing was appropriate for them. Shortly after, this page was listed as unavailable in the UK.

Robinhood has put on hold its plan to allow margin investing to UK-based consumers until further talks with regulators, as it launches in the UK.

Robinhood's UK expansion journey

Robinhood, which surged in popularity among US retail investors during the 2021 meme stock trading frenzy, had scrapped previous plans for a UK launch in 2020, before announcing a second attempt in November 2023. The UK arm will allow customers in the UK to buy US stocks, but not stocks of companies listed elsewhere.

It will not charge commission fees or FX fees on trades, and will offer interest rates of 5% on customers' uninvested cash, the company said.

Previous news from Robinhood

In February 2024, Robinhood has introduced the Retirement for Independent Workers programme to address the need for retirement savings among freelance and side job workers. This initiative aims to offer access to retirement savings plans for individuals engaged in non-traditional employment structures. 

The initial partners for Robinhood Retirement For Independent Workers include Gopuff, Grubhub, and Taskrabbit, companies that offer flexible earning opportunities to independent workers in various sectors such as instant commerce, food delivery, and home services within the gig economy.

In the same month, Consensys and Robinhood Markets have collaborated to integrate Robinhood Connect with MetaMask, enabling customers to enhance their crypto purchases. Through MetaMask's Buy Crypto feature, users can now buy crypto using Robinhood's low-cost order engine.

This integration aligns with MetaMask's mission to support web3 adoption by offering frictionless, secure, and self-custodial onboarding to users. Customers gain more options and control over their digital assets, leveraging the seamless connectivity between Robinhood Connect and MetaMask's Buy Crypto aggregator to easily purchase crypto from various providers.

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Keywords: trading platform, regulation, lending, FX , investment
Categories: DeFi & Crypto & Web3
Companies: Robinhood
Countries: United Kingdom
This article is part of category

DeFi & Crypto & Web3


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