US-based stock trading app Robinhood’s UK launch may be a step closer following the hire of a UK CEO.
According to an FCA filing, Jordan Sinclair has been named as Robinhood’s UK chief, having previously served as managing director of the European fintech Freetrade.
The appointment marks the latest development in the platform’s long-awaited UK launch, which has been on-and-off for over four years.
Robinhood went public in 2021, raising close to $2 billion.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Get 6 issues free
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
But what will the launch of Robinhood mean for UK retail investors, and will it stack up against the competition?
What is Robinhood?
In practice, Robinhood is an investment platform that allows investors to buy and sell stocks, exchange-traded funds (ETFs), and cryptocurrencies.
It rose to prominence during the lockdowns of 2020 and acted as a bedrock for the boom in retail investing in the US. There, it gained notoriety after it “gamified” investing for novice traders, particularly young people. They were drawn to its user-friendly interface and fee-free trading.
Its model of making investing accessible and approachable has driven its growth. In February 2023, the company reported 12 million monthly active users, with assets under custody of $74.7 billion.
When will Robinhood launch?
The app’s parent company, Robinhood Markets, has long planned to launch the service in the UK but has so far not been able to.
In 2019, the company gained broker authorisation from the FCA and opened a waitlist for people in the UK, but was later forced to postpone its launch.
In a statement published in 2020, the company said: “A lot has changed in the world over the past few months, and we’ve made the difficult decision to postpone our U.K. launch indefinitely. As a company, we are refocusing our efforts on strengthening our core business in the U.S.”
“Although our global expansion plans are on hold for now, we’re committed to democratising finance for more people around the world. We look forward to the day when we can bring this mission to the U.K.”
But the appointment of Sinclair has reignited talk of Robinhood’s long-awaited UK debut.
A Robinhood spokesperson declined to comment on any plans for the app’s potential UK launch, but we will update you on the latest developments as they happen.
The UK investment platform market is already mature, with large brands competing for customers.
In April, Virgin Money launched its own platform, aimed at those relatively new to investing, while earlier in the year, M&G Investments launched the &me investment services to help new investors. AJ Bell launched Dodl last year, also aimed at beginners.
Robinhood’s UK app would be in direct competition with these platforms as well as the likes of Vanguard, AJ Bell, interactive investor and Fidelity.
While they all act as a platform to invest on, each service varies in terms of costs, what may be liable for a fee, the kind of investments you can access and whether any kind of advice is offered.
In the US, Robinhood gained a user base that valued the DIY-approach with its low-cost, no-thrills service, and may attract the same kind of investor should its UK launch go ahead.
So, if you’re not looking to pay for the expertise of a stock picker, then Robinhood could be a good option for you. We will update you with all the details on how to sign up, fees and how it compares to other fund platforms as soon as more details are unveiled.
Join us at the MoneyWeek Summit on 29.09.2023 at etc.venues St Paul's, London.
Tickets are on sale at www.moneyweeksummit.com
MoneyWeek subscribers receive a 25% discount.
How does the Lifetime ISA work? Key LISA rules
AJ Bell: a fine British fintech going cheap
