What is Samsung Money by SoFi?
On 27 May Samsung announced the launch of Samsung Money by SoFi .
According to Samsung, the new product is a mobile-first money management experience that combines a cash management account and a Mastercard-branded debit card.
The account will become part of Samsung Pay and, says the company, is a simple and secure way to manage everyday finances.
Samsung Money has been developed in partnership with fintech company, SoFi and is built with the goal of making users’ everyday lives better through the use of powerful tools on their Galaxy devices.
The account is secure, with no account fees - it also rewards users for saving. For example, they can earn higher interest relative to the national average of transnational accounts.
Money management made simple
As leaders in their respective fields, both Samsung and SoFi are committed to the use of technology to let people take more control of their financial lives.
Sang Ahn, Vice President and GM of Samsung Pay, North America Service Business, Samsung Electronics, said: “Samsung’s goal is to make everyday life better by putting powerful tools in the hands of Galaxy users.
“Samsung Money by SoFi is our biggest move yet to help users do more with their money [...] users can access mobile-first financial services and earn exclusive Samsung benefits. We’re excited to help our users reach their financial dreams by allowing them to spend, save and grow their money and access it easily and securely.”
The product will launch later this year, combining the convenience of mobile payments and the control of a debit card.
Users will have the ability to choose between opening an individual or joint cash management account - they can also benefit from in-network ATM fee reimbursement at over 55,000 locations in the US.
Upon activating the account the virtual Mastercard-branded card will be able to use from Samsung Pay - a physical card is also provided.
Smart money management is also available. For example, users will be able to check their balance, review past statements or search transactions.
Similarly, they can flag suspicious activity or change any account details, all from their mobile device.
Rewards and benefits
Samsung Money by SoFi offers a host of benefits and rewards.
For example, users can enroll in the Samsung Rewards programme to earn points for every purchase made through Samsung Pay.
Security is built into the product, too. Accounts are FDIC insured up to $1.5mn and account holders are given defense-grade security from Samsung Knox.
In addition, the physical debit card has no card number or details on it. Instead, this information is hosted within the Money tab of the accompanying mobile app.
Robinhood faces $35mn fine from New York DFS
The company’s crypto division was issued with a wrist slap in 2020, following the red flagging of several “matters requiring attention”. Robinhood revealed it had reached a settlement with the New York State Department of Financial Services regarding the issues, which related to “alleged violations” of cybersecurity and anti-money laundering rules.
The news follows on from the announcement earlier this week that the trading platform favoured by armchair investors, which almost broke Wall Street earlier this year, has an expected valuation of $35bn following its IPO.
Critics of the platform say Robinhood encourages “risky behaviour” among inexperienced (armchair) investors. The app has also been criticised for not informing customers that much of its profits are generated by routing their trades to Wall Street firms taking the other side, or so-called "payment for order flow."
Robinhood said last month they expected the DFS fine to be at the $15mn mark, adding it would be “the bottom of the range for our probable loss in this matter”. The $35mn penalty is on top of the record $70mn Robinhood incurred from US financial regulator FINRA in June, for “lax vetting and outages.”
However, the settlement indicates the company’s IPO will go ahead as planned, despite initial concerns the investigation could see the float delayed until later this year.
Robinhood floats imminent
Despite the regulatory hiccups, Robinhood priced its IPO between US$38-US$42 per share, giving the platform the US$35bn valuation and analysts predict the firm’s debut on the Nasdaq could occur as early as next week.
Robinhood democratising investment
Launched in 2013 by Tenev and Bhatt, who were Stanford University roommates, Robinhood’s founders will retain most of the voting rights after the IPO. Bhatt reportedly holds 39% of the voting power of outstanding stock, while Tenev holds 26.2%.
The online brokerage, which came under fire for its handling of the GameStop trading debacle, which saw the platform limit stocks to investors, states its mission is to “democratise” investing and is one of the most highly anticipated IPOs of the year.
Robinhood was valued at $11.7bn in autumn 2020 following a private equity funding drive. The new valuation will mean represent a three-fold increase in the company’s market value in less than 12 months.