Robinhood, the startup which kickstarted the commission-free trading trend in the United States, announced this week that it was withdrawing its bank chart application, which would have allowed the company to become a full-service bank.
In an email to multiple news outlets, the company said: “We are voluntarily withdrawing our OCC application for a national bank charter. Robinhood will continue to focus on increasing participation in the financial system and challenging the industry to better serve everyone.”
“We appreciate the efforts and collaboration of all the parties we worked with throughout this process,” a spokesperson of Robinhood added.
The application was filed with the US Office of the Comptroller of the Currency. The company has not specified why it has decided to withdraw its application; however, it is not likely to have a large impact on the firm’s long-term plans.
However, had the stock trading platform had its application approved, then Robinhood would have been able to offer its own banking products without needing to partner with another bank.
Robinhood continues to explore new services
The company has gained increasing popularity with young consumers since its launch back in 2013. The platform made waves with its unique commission-free offering, and since then, the company has been looking to expand the types of financial services it offers.
Last year, the company showed its interest in offering banking products, when it tried to launch zero-fee checking and savings accounts. However, Robinhood quickly shut down the service after facing backlash from financial lawmakers and regulators.
As FortuneZ reported, Robinhood raised its latest round of funding in July, bringing in $323 million at a $7.6 billion valuation, up by $2 billion from its Series D valuation in 2018.
The investment was led by DST Global, the firm run by Israeli-Russian billionaire Yuri Milner, and includes participation from new and existing investors such as Ribbit Capital, NEA, Sequoia, and Thrive Capital.