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Robinhood’s new credit card follows Apple Card, offers cash back benefits

eight months later Acquired credit card startup X1 Robinhood announced today that it is spending $95 million to launch a new gold card, with a series of features that would make even Apple Card users envious.

Robinhood, best known for its brokerage app aimed at everyday investors, is touting a variety of benefits with its new card to try to attract users. The card has no annual fee or foreign transaction fee. However, it’s only available for Robinhood Gold members and costs $5 per month or $50 per year. (gold is a plan that offers other benefits, such as a 5% annualized return on uninvested brokerage cash in the account. )

Gold card users get 3% cash back on all categories, including restaurants and groceries, and 5% cash back when booking travel on Robinhood’s new travel portal. The company says these cash backs can be transferred to a brokerage account and used to make investments such as stock purchases.The ability to invest using cash back isSignificant innovations developed by X1 prior to acquisition.

Another interesting feature of Gold Cards includes the ability to provide cards to family members.This is the first time Robinhood has launched a financial product for families, said Robinhood Money General Manager deepak rao told Technology Blog. Prior to joining Robinhood in its acquisitions, Rao was the founder and CEO of X1.

Users can add up to five family members as cardholders to their account, and each cardholder will receive their own card. Supplementary cardholders can be of any age, giving parents a way to help their teen build credit and monitor spending. The ability to provide cards to family members even works for visitors from other countries.

“Users can provide a card to a parent, child or caregiver and set up the right controls and protections while helping them build credit,” Rao said. “They don’t need to provide any other information other than their name, date of birth, and Social Security number (if they have one). If you’re concerned about spending limits, you can set dollar amount limits as well as child-safe mode.”

The card also allows users to create and delete virtual cards for one-time purchases, with annual interest rates ranging from 20.24% to 29.99%, which Robinhood says will change with the market based on prime rates.

Robinhood also de-numbers its physical cards, so users don’t have to replace all of their card information if their physical cards are lost or stolen. The company will also launch a new app to accompany the new gold card, which will be completely separate from its investment app, Rao said.

Generally, gold accounts are FDIC insured up to $2.25 million through a network of partner banks.

Cash back

Robinhood’s move into the credit card market is clearly inspired by the likes of Apple, which has seen huge success with its own credit card (despite some problems with its credit card business) Cooperation with Goldman Sachs). By forgoing hidden fees like annual fees or late fees and using cash back every day, Apple Card The number of users exceeded 12 million As of January.

Many cards offer cash back, but it’s usually limited to certain categories. The cash back offers on this card are generous. For example, Apple offers 3% cash back on all purchases made at Apple and at select merchants using Apple Card and Apple Pay. Generally speaking, users can get 2% cash back on purchases made on Apple Card using Apple Pay. But Apple also offers family sharing capabilities, as well as a high-yield savings account with an interest rate of 4.5%.

Apparently, Robinhood will earn interchange revenue from credit cards, which are the standard transaction fees merchants pay. It earns interchange revenue through debit cards, Launched in 2018. Coastal Community Bank is Robinhood’s banking partner on the new Gold Card.

The new credit card is part of Robinhood’s growing business model and products over the years. December 2022, company announcement robin hood retires, which describes it as the “first and only” Individual Retirement Account (IRA) with a 1% match on every dollar of qualified contributions. Gold membership is required to qualify for Gold, which increases your qualifying match rate to up to 3%.

“Special benefits and opportunities have always been reserved for the rich to make them even richer. That’s why we started Robinhood…” Robinhood co-founder and CEO Vlad Tenev said in a written statement. “Today’s announcement … brings us one step closer to our goal of giving everyone better access to the financial system.”

Robin Hood Gold Card explained:

What are the requirements for applying for the Robin Hood Gold Card?

you must be one Robin Hood Gold Card membership.

You must first meet the following conditions Certificate Apply for card:

  • Must have Robinhood Gold account.
  • 18 years or older
  • Have a valid Social Security number (not a taxpayer identification number)
  • Have a legal residential address within the 50 states of the United States (exceptions may be made for active duty members of the U.S. military stationed abroad)
  • Be a U.S. citizen, U.S. permanent resident, or hold a valid U.S. visa

Is there a monthly fee for the Robinhood Gold Card?

You must be a Robinhood Gold member to apply for this card. It costs $5 per month to become a Robinhood Gold member, or $50 per year.

Does the Robinhood Gold Card have foreign trading fees?

No, there are no foreign transaction fees.

Will my credit be canceled when I apply for the Robinhood Gold Card?

Robinhood won’t do a hard pull on your credit before you accept a credit card offer.

What cash back offers and benefits does this card offer?

  • Users can get 3% cashback on all categories. These cash backs can be transferred to a brokerage account and used for investments such as stock purchases.
  • Users can add up to five family members as cardholders to their account, and each cardholder will receive their own card.
  • Cardholders can create and delete virtual cards for one-time purchases.
  • The physical cards will be numerous, so users don’t need to replace all of their card information if they are lost or stolen.

Is Robinhood Gold FDIC insured?

Robinhood offers FDIC insurance up to $2.25 million through a network of partner banks.

You can view the full archive of Robinhood announcing the Gold Card event below.

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This article was originally published on March 26 at 4pm PT and has been updated to include Robinhood’s livestream and additional commentary.

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