Robinhood Markets (NASDAQ:HOOD) has introduced 3% interest on brokerage cash sweep for its Robinhood Gold customers, double the 1.5% rate earned by non-Gold members, the fintech said Monday.
The 3% interest on uninvested cash in Gold accounts, is 23x more in interest than the national average savings rate, the company said. Gold users currently have ~$750M enrolled in cash sweeps. The interest is compounded daily and then paid out monthly by program banks, Robinhood (HOOD) said.
To get the 3% rate, customers must enroll in cash sweep within the app. All eligible customers who opt in to brokerage cash sweep have their uninvested brokerage account cash automatically "swept" into deposit accounts at a network of six program banks. Robinhood (HOOD) customers can upgrade to Gold for $5 a month.