As popular US-based trading app Robinhood postpones its UK launch indefinitely, eToro has announced plans to launch a debit card for both customers and non-customers in Europe and the UK.
Israeli trading and multi-asset brokerage company eToro has announced plans to launch a debit card in the UK and Europe. The announcement comes as the trading business acquires UK-based e-money business, Marq Millions, which will now trade as eToro Money.
The terms of the acquisition were not disclosed, but eToro Money will now be the issuer of the acquiring firm’s upcoming debit card. The company’s announcement comes as rival trading platform Robinhood indefinitely postpones its UK launch.
According to TechCrunch, the firm’s debit card will initially launch for select eToro members in the UK, before expanding to Europe. After this, the company plans to extend its debit offering to non-eToro users.
The company has acquired a Principal Membership with Visa and an electronic money institution (EMI) licence from the Financial Conduct Authority.
Trading competition in the UK
As pointed out by TechCrunch, the Israeli firm is “racing to build up its UK user base” before US-based investment platform Robinhood enters the market. In less than a year, Robinhood’s valuation has risen from $7.6bn in July 2019 to $8.3bn in May 2020.
eToro CEO and co-founder, Yoni Assia, commented: “The launch of a debit card is a natural next step for eToro as we broaden the range of services that we provide to our users. The debit card will provide instant cash-out and cash-in functionality, greatly improving the user experience. We expect to see a strong take-up of the card – initially from our client base.”
Since eToro was founded in 2006, it has signed up more than 14m registered users. Robinhood, which was launched in 2013, is quickly catching up. The firm announced that it had topped 13m users in May 2020.
At its 2019 valuation, the company’s founders said that Robinhood sets out to “democratise” finance by making trading more accessible. The company currently has a waiting list of more than 250,000 people anticipating the release of the app in the UK.
Delaying the UK launch
However, the company announced that it would postpone its UK launch indefinitely following the death of a 20-year-old customer in the US. It was reported that the customer died by suicide after he mistakenly believed that he had lost $730,000 by using the app.
While announcing the postponement, Robinhood’s founders said: “We’re saddened to share that we’ve made the difficult decision to postpone our UK launch indefinitely. We’ll be closing our waitlist and taking down our UK website shortly.”
In response to the young man’s death, regulators in the US have pressed Robinhood to improve safeguards on the app, which attracts many young adult users with little experience in trading. Robinhood has since agreed to work with lawmakers to address concerns.
Illinois Democrat representative Lauren Underwood described the app as a “recipe for disaster.” She said: “Robinhood has designed a platform that feels very much like a video game… It’s not a game. It’s real life.”