Multiple sources have reported that Robinhood Markets Inc. has been in talks with US regulators to offer financial products traditionally issued by banks. With a US user base of more than 4 million (80% of whom are under the age of 30), anonymous individuals have indicated that the company is having “constructive conversations with the Office of the Comptroller of the Currency,” according to Julie Verhage and Olivia Zaleski from Bloomberg.
If the talks end successfully, Robinhood will be issued licenses, charters, and partnerships to offer something as basic as a savings account for users. What might sway a younger demographic to adopt Robinhood’s platform (along with other emerging fintech startups) is its streamlined user experience, and deeper customer engagement and services. Robinhood also began offering options trading last December, whose volume this past quarter surpassed the “most optimistic expectations” of the team, according to Vlad Tenev, Co-CEO of Robinhood.
Robinhood’s launching of cryptocurrency trading these past several months strategically falls in line with sentiments expressed by U.S. Senators in February. More specifically, J. Christopher Giancarlo, Chairman of the CFTC, mentioned how incumbent regulators and politicians “owe it to this new generation to respect their enthusiasm about virtual currencies.” If Robinhood can secure a banking license, a suite of traditional financial products would only deepen Robinhood’s reputation as a financial institution.
Jack Randall, a spokesman for Robinhood, declined to comment. Perhaps the Robinhood team does not want to count its chickens before its eggs hatch, but the hype is certainly brewing and people are talking.