Robinhood is moving forward with its plan to allow users to lend their shares to other financial institutions, a program known as fully paid securities lending, Bloomberg reported on Wednesday (March 16).
The company aims to compete with more conventional brokers and said the feature, which first appeared on a beta version of the iPhone app, could be available in the coming months.
According to Bloomberg, the service is dubbed the Stock Loan Income Program (SLIP), based on code uncovered by developer Steve Moser.
“Through SLIP, you have the ability to earn passive income by lending entire shares to other institutions,” according to an explanation of the feature in the app. “These institutions may borrow shares to settle trades or facilitate short selling. You will be able to buy and sell as usual, even if your shares are on loan.
The lending program would rival similar programs from companies like Morgan Stanley, Fidelity Investments and Charles Schwab Corp, which allow customers to earn passive income by lending their own stock.
In January, Robinhood CEO Vlad Tenev said the company was working on the program at the time, although no details were provided.
“We are still on track to launch this product in the first half of 2022, which will bring even more value to our customers,” Robinhood representative Rouky Diallo told Bloomberg in an emailed statement on Wednesday.
PYMNTS recently wrote that two former Robinhood employees have launched a new program that aims to support global money transfer services like PayPal.
Read more: Former Robinhood employees launch flat-fee transfer service Atlantic Money
The company, Atlantic Money, is a flat-fee platform that promises to offer a “better deal” than other exchange services. He was trained by Neeraj Baid and Patrick Kavanagh, who both left Robinhood at the end of 2020.
Their idea was to examine the difficulties and expenses associated with “financial lives spread across continents”. Their project caused friction, even despite its disruption of industry monopolies.