Robinhood to launch fee-free ISA in the UK

In an interview with the Financial Times, Robinhood’s president stated that the company has seen interest from their customers in UK equities and announced plans to launch an ISA by the end of the current tax year. 

In the same interview, the company representative highlighted the UK's efforts to increase retail investment and support the struggling capital markets as a positive development. By taking this step, Robinhood will join other neo-brokers and investment platforms that have entered the market to disrupt the leading players in the UK ISA scene.

What is more, this announcement follows a government initiative aimed at encouraging greater investment in UK equities and revitalising the country's capital markets.

The UK’s ISA consultation and recent ISA announcements

The UK Treasury is considering reforms to ISAs and, recently, unveiled the Private Intermittent Securities and Capital Exchange System Sandbox  (PISCES) framework. The proposed regulatory framework for PISCES is established under a Financial Market Infrastructure (FMI) sandbox developed by the Treasury.

PISCES aims to bring some of the trading infrastructure used in public markets to private companies. As a result, these markets will be better equipped to serve a wide range of companies across different stages of their life cycle. This is anticipated to promote growth and support innovation in the UK economy. 

Recently, the UK government also considered lowering the annual tax-free per person allowance for ISAs from GBP 20,000 to GBP 4,000. However, the proposal was met with criticism from both financial institutions and savers and was later officially dropped. This decision ensured that savers could continue to allocate up to GBP 20,000 annually across various ISA types, including cash ISAs, without paying tax.