Robinhood targets wealthy customers with new Platinum credit card
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FILE PHOTO: The logo of Robinhood Markets, Inc. is seen at a pop-up event on Wall Street after the company's IPO in New York City, U.S., July 29, 2021. REUTERS/Andrew Kelly/File Photo
March 4 (Reuters) - Robinhood launched a new credit card for high-income customers on Wednesday, in an attempt to secure a foothold in an industry dominated by heavyweights such as American Express and JPMorgan Chase.
The trading platform will charge $695 per year for the Platinum card, while offering users cashback and other benefits worth $3,000, it said.
American Express' Platinum card carries a fee of $895, while JPMorgan's Chase Sapphire Reserve charges $795. Both also offer a range of premium perks worth $3,500 and $2,700, respectively, according to their websites.
Robinhood's new card is part of an ongoing makeover to shed its image as a tool for speculative trades. As its customers get older, the company is seeking to reposition itself as a financial platform providing a wider range of services.
"We want to go after the legacy players' customers," said Deepak Rao, vice president and general manager of Robinhood Money, adding that AmEx was "obviously the benchmark".
The card could also act as a channel to bring in wealthy customers who can then choose to use Robinhood's other services, Rao said.
MATURE USER BASE
The Menlo Park, California-based company also launched custodial accounts that parents and guardians can use to invest on behalf of a minor.
Customers can schedule recurring investments and invite family and friends to contribute to these accounts. When the minor reaches adulthood, the assets are automatically transferred.
"Our customers are maturing and starting to have more complex financial needs," said Abhishek Fatehpuria, Robinhood's vice president of product.
"Many of our customers were first-time investors with us. And now their median age is in the mid-30s. We want to make Robinhood the place where we can serve them."
(Reporting by Niket Nishant in London and Manya Saini in Bengaluru; Editing by Krishna Chandra Eluri)
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