The app that lets you trade stocks without paying any fees is now giving out lines of credit

Robinhood, the app that lets you trade stocks without paying any fees, is rolling out a premium tier called Robinhood Gold that starts at $10 per month, and gives access to features like a line of credit and after-hours trading.

Robinhood launched in December 2014 and quickly became a favourite among younger people looking to invest without paying $7 per trade. The app itself is stylish and simple, which helped lure the first-time investors that made up Robinhood’s first big wave of users.

Cofounder Baiju Bhatt tells Business Insider that about 10-20% of Robinhood’s 1+ million user base in now comprised of more sophisticated investors, and Robinhood Gold is for them.

Here are the three basic things you get in Robinhood Gold:

  • After-hours trading. Robinhood has extended the trading day by 30 minutes before the market opens and two hours after it closes, for a total of 2.5 extra hours. Bhatt stresses this will be particularly useful around earnings, which usually drop at market close.
  • A line of credit. Robinhood thinks about this like a credit card for the stock market, according to Bhatt. Because of federal laws, it will only be available for people who have at least $2,000 in their brokerage accounts. The line of credit Robinhood gives you will depend on a few factors — such as how experienced you are as an investor — but the most you’ll be able to get is double your account balance. Bhatt says Robinhood actually isn’t taking as much risk as you might think, since the company is still the custodian of your account. You can’t run up a huge credit card bill and then flee with the assets. There will also be limits on what you can purchase on a per-stock basis. You can’t dump your entire credit line into penny stocks, for instance.
  • Bigger “instant deposits.” In February, Robinhood fixed one of the most annoying elements of the app, which was that funds had to “settle” before you invested them. Robinhood made deposits up to $1,000 available invest instantly, but with Robinhood Gold, that has been pushed up to $2,000 — or more, depending on your account size.
Vlad Tenev, Baiju Bhatt, robinhood, sv100 2015RobinhoodRobinhood cofounders Vladimir Tenev and Baiju Bhatt (from left)

The pricing of Robinhood Gold will depend on a few factors. There will always be a basic tier that starts at $10 and gives you access to after-hours trading, the bigger deposits, and a basic line of credit. Depending on how much you have in your account, and how much extra buying power you want, Robinhood will also make you an offer for two more (variable) higher-price tiers.

Bhatt says Robinhood Gold is something the company has been planning since the beginning. It was actually in the first release of the app way back in late 2014, but the company took it out, he says. “It didn’t feel done yet,” Bhatt explains.

Bhatt hopes Robinhood Gold will be a big step toward making the company profitable. Robinhood’s ultimate goal is to become “the savings tool” people use, not just for stocks, but for everything. “We have a long view on monetisation,” he says.

Expect Robinhood to continue rolling out products that push it to a more lucrative space than no-fee trades.

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