Robinhood is giving banking another shot.
Ten months after the failed launch of a checking and savings account, the free stock-trading start-up announced a cash management account with a 2.05% interest rate. The APY is more than twenty times higher than the national average for savings accounts, according to Bankrate.com.
In December, Robinhood said it would offer zero-fee checking and savings accounts with a 3% interest rate alongside its brokerage accounts. The move was seen as a shot across the bow of traditional banks. But the product saw swift pushback from regulators who questioned the SIPC insurance it was promising, which is meant for brokerage accounts — not for savings products. A day later, Robinhood said they would re-brand and re-name the product after the “confusion.”