Revoluts adds stock trading to its app to get millennial investments

The fixed and dense investment world does not immediately appeal to millennials. Words such as 'broker' or 'stock portfolio' are foreign to the offspring of the Internet age, fed on a steady stream of Netflix and Deliveroo. But a new fleet of investment tools promises a sleek, app-ified and user-friendly revolution of the kind that the fintech pioneers brought to the banking industry.

Revolut, the most popular of this digital darling crop, has launched a new trading feature today, offering European customers free palm trading on stocks from 300 New York and NASDAQ listed stocks ̵[ads1]1; such as Amazon and Tesla.

Revolut's trading platform has been teased since August 2018, when the company published a blog post that signaled its intention to change investment in shares. "Investing in the stock market has been closed to ordinary people for too long, which has caused real problems for people as they search for effective ways to make the most of their savings," Nik Storonsky, founder and CEO of Revolut, said that in a statement.

The new opportunity is first rolled out to Revolut's metal card customers – its advanced banking service – before being made available to the rest of the bank's EU-based customers in the coming weeks. (More than 1.5 million customers are based in the UK). The company starts with US equities, as it claims feedback from their customers showed that they were most in demand.

But there are limitations: Revolut Metal customers can make 100 free trades per month, while Premium customers will get eight, and Standard customers three. Excluding these quotas, it will cost £ 1 per trade, and an annual storage fee of 0.01 per cent. This is in contrast to most EU-based stock brokers, which typically charge between £ 6 and £ 12 in transaction fees per trade. Revolut says that other trading fees may accrue from US regulators and that deals are being processed by the US company DriveWealth LLC.

So why does Revolut move into the area? In short: taking a foot in a growing market. In recent years, the increase in investment apps that offer people the chance to put some of the income or savings into stocks and shares. The ability to make investments through smartphones has opened up new potential audiences.

The most successful, Silicon Valley-based Robinhood, has tempted younger people to buy stocks, as well as support trading in cryptocurrencies such as bitcoin, ethereum and litecoin. The company last week announced a funding round of $ 323 million (£ 264 million) led by DST Global, valued at $ 7.6 billion (£ 6.22 billion). The user base consisted of more than four million people, as of May this year.

Acorns, launched in 2014, rounds out expenses and puts the money into investment. If you fork out £ 9.80 on a lunch and pay through the company's debit card, it will take the extra 20p micro investment. The company says more than $ 1 billion (£ 82 million) has been invested through the company. Alternatively, US-based Stash offers subscription-based investments with a series of monthly payment plans.

Of the UK's largest challenger banks, including Monzo, N26 and Starling, Revolut is the first to start offering its clients investment options. It is unclear if any of the other banking apps are planning to do the same. This can give Revolut an edge in attracting more customers.

"At the moment, these are very wealthy people – typically the market 35 or 40 plus," says Chad West, communications manager at Revolut. "Now we can really open up to younger audiences looking for more savvy ways to invest their money by removing two entry barriers: usability and accessibility." He points out that savings accounts are currently regarded as the best solutions for collecting cash, despite many falling under inflation.

The trading feature will be available through a tab labeled & # 39; Trading & # 39; on the app, and customers will be able to choose the companies they are interested in. A chart shows the last 12 months of stock development, and provides insight into whether it will make a wise investment decision. Separating it from traditional investment is the opportunity to buy fractions for as little as $ 1 – a blessing given that some of the world's most competitive companies are upwards of $ 400 and topped $ 1,890.87 for a stake in Amazon.

Expansion plans cover access to UK and European equities, Exchange Traded Funds (ETFs) and the ability to invest via an ISA of equities and shares, as well as expanding the opportunity for Revolut users outside the European Economic Area (EEA) ).

The ability to invest in shares and shares of Revolut follows the launch of its crypto app which debuted in March. The stock exchange means that one of the 29 currencies that Revolut supports can be exchanged for Bitcoin, Litecoin, Ethereum, Bitcoin Cash and XRP. The crypto exchange is similar to what Coinbase does, but within Revolt's existing app.

The new feature of the embattled fintech company comes as it is being investigated by the Financial Conduct Authority on how it handles payments.

In February this year, a WIRED survey revealed problems with Revolut's work culture. Former employees and employees exposed job seekers who were asked to work for free, cheekiness and high staff turnover in the company. It promised to clean up the action.

Over the past few months, the company has been looking to change its image. This week, the company said it would hire Metro Bank executive David MacLean as its new chief financial officer. Former CFO Peter O. & # 39; Higgins left the company earlier this year, saying it needed someone with more "global retail banking experience."

But with the move to the stock market, how will Revolut ensure that people are not investing indefensibly? West says the regulator prohibits providing investment advice. However, the bank has made sure there are plenty of warning signs warning customers about the possibility of losing their money, while volatile stocks will be highlighted in red.

“People don't want six apps on their phone, says West. “They don't want one for their banks, one for their cryptocurrency, one for their investments, one for their insurance; if they can have everything central to an app, they will. ”

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