(Bloomberg) -- Robinhood Markets Inc. has more than 4 million U.S. consumers using its free stock-trading platform. Now, it’s in talks to offer them other banking services like savings accounts, according to people familiar with the matter.
The Menlo Park, California-based firm is not allowed under current rules to operate like a bank, but it’s in early discussions with regulators to begin offering banking-like products through different licenses or partnerships, these people said, asking not to be identified because the talks are confidential. One of the people said the company is having constructive conversations with the Office of the Comptroller of the Currency, which charters and regulates all national banks and federal savings associations. However, the talks are not finalized and could still fall apart.
If Robinhood were to start performing more traditional banking services, it would fit into a larger trend among financial technology startups. Firms like Social Finance Inc. and Stash Financial Inc. have debuted similar products in recent months. The strategy is increasingly thought of as a way for young digital companies to deepen relationships with consumers, and to woo people away from larger banks by offering a smoother user experience, high interest rates, and the ability to access several features in one place.
Jack Randall, a spokesman for Robinhood, declined to comment.
Because there are regulations around performing banking services, most startups that have been offering these products have done so through partnerships or mergers with existing institutions, rather than getting a banking license themselves, which can take several months if not years to finalize.
If it’s successfully launched, this would be far from the only new service Robinhood has added in recent months. Over the past year, the firm has introduced trading in certain cryptocurrencies as well as options trading. The company’s founders have said that deepening relationships with customers is a priority going forward.
In May, the company received a valuation of $5.6 billion in a new round of funding. Investors signing on to back the startup for the first time in that funding round included Sequoia Capital, Kleiner Perkins Caufield & Byers, Iconiq Capital and Alphabet Inc.’s growth fund CapitalG.
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