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Robinhood's offering is indistinguishable from a cash management account at a brokerage. Short-term deposits, check writing, debit card, interest bearing, etc.
by panarky 8y ago
Robinhood's offering is indistinguishable from a cash management account at a brokerage. Short-term deposits, check writing, debit card, interest bearing, etc.
Fidelity Investments pioneered this product, and now it's available from others like Schwab.
But at Fidelity, the cash management account is distinct from the brokerage account. While the brokerage account is insured by the SIPC, cash management funds are swept into FDIC-insured balances at actual banks.
Looks like Robinhood is gonna lose on this one.
Source: https://www.fidelity.com/cash-management/faqs-cash-management-account https://www.fidelity.com/cash-management/faqs-cash-managemen...
- acjohnson55 8y agoIt seems like RH is taking this to the next step (at least with respect to Fidelity) by building typical checking account features around it, with parameters that are best-in-class.
- SpaethCo 8y agoFidelity already has best-in-class checking account features? The CMA account has mobile image deposit, free online bill pay, check writing (with free checks), free ACH transfers, free wire transfers, ATM/debit card (with ATM fee reimbursement at any ATM worldwide, no less), etc. The only “best-in-class” factor that Robinhood has presented is setting the interest at 3%.
- acjohnson55 8y agoGood to know, I was reading briefly from their site and didn't see any of those things expressed upfront.