It's written about a 'neobroker' in this piece. - Trade Republic debuts an account with interest - launch particulars and functionality
German neobroker Trade Republic has unveiled a fresh checking account that lets clients perform everything associated with a traditional checking account, such as receiving a salary, transferring funds, establishing direct debits, or adding cash to the app in real time. Some four million current customers of the startup, which was founded in Berlin in 2019, will soon receive an International Bank Account Number (IBAN) for their existing account.
This move comes as no shock, given that Trade Republic was granted a full banking license in December 2023. In a January interview with Capital, Trade Republic's CEO, Christian Hecker, shared his ambition for the new account. He stated, "We want our customers to use their account with us not only for investing in securities, but also for spending money."
The first stage of this goal was achieved with the introduction of a Visa payment card, partnered with Trade Republic. Per transaction, customers receive one percent of the amount that flows into a preselected savings plan, with a top limit of 15 euros each month. The card, which is currently used by approximately one million people across Europe, is now poised to close its waitlist.
In addition, Trade Republic has recently been paying interest on deposits. This was initially capped at 50,000 euros in savings, but with the new checking account, the upper limit has been lifted. Interest rates will continue to be set at European Central Bank (ECB) levels, currently 4% annually, and passed on to customers. The company further explained that the cash deposit will be distributed into a portfolio of partner banks, such as Deutsche Bank, HSBC, or J.P. Morgan, to increase savings for higher balances.
Trade Republic was started by Christian Hecker and two other co-founders in 2019. Today, the broker boasts a customer base of four million people spread across Europe. The most recent funding round in 2022, as reported by Capital, valued the company at five billion euros.
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Trade Republic's new checking account, which allows for traditional banking functions and interest earnings, aligns with their ambition to become a one-stop financial solution, as expressed by CEO Christian Hecker to Capital in January 2024. The European Central Bank (ECB) sets the interest rates for Trade Republic's deposits.
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