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Can't you say the same thing about everyone using any other retail brokerage?

• QuackingJimbo 7y ago
  No. Upstanding retail brokerages (such as Interactive Brokers) don’t make interest on their customers’ balances.
  • notyourday 7y ago
    Huh? That's just not how this works. There's always a spread between the cash interest that the custodial firm gets on the balances it holds and the interest it pays to the customers.
  • usmannk 7y ago
    Woah that is totally untrue. Brokerages make a lot of money by investing your balance. In particular, IB makes 49% of its revenue this way. https://www.kalzumeus.com/2019/6/26/how-brokerages-make-money/ https://www.kalzumeus.com/2019/6/26/how-brokerages-make-mone...
  • benj111 7y ago
    Interactive Brokers makes 49% of revenues from customer balances. https://www.kalzumeus.com/2019/6/26/how-brokerages-make-money/ https://www.kalzumeus.com/2019/6/26/how-brokerages-make-mone...
  • Youden 7y ago
    To add an even clearer source to the other replies: https://www.interactivebrokers.com/en/index.php?f=1595 https://www.interactivebrokers.com/en/index.php?f=1595 IB is abundantly clear that it makes money from cash balances. I'm not sure where you got this idea from.
  • gtfratteus 7y ago
    Assuming that's true, how would that make RobinHood a predatory lending scheme?