After reading quite a few posts about T212 not being profitable, having issues etc I thought I’d create a post.
I hope I’m not on my own when I say that T212 is probably the cleanest, most user friendly interface on the market at the minute? I could be wrong but I’m yet to be convinced otherwise. It has great deposit/withdrawal systems although, the withdrawals could be slightly tweaked so we the user know where our withdrawals are going to go ie. bank account, PayPal, prepaid card (I use a lot) etc etc.
We know the CFD situation at the moment is a bit chaotic but, company is taking steps to mitigate losses etc but, for the user it’s not as rosy as other CFD providers on the market.
It does state and has been repeated many many times that it is a free platform (Invest/ISA) and will continue to stay so.
The company is charging the deposit fees that are associated with deposits and that’s fair enough so, we know they won’t have a huge outlay next year for incurring the fees themselves.
It’s left me wondering what the company could do that A) Would benefit the company (its a business after all) and B) Would benefit its customers.
Could the company switch from Private to Public? Would be a great stock to hold in the portfolio and company could give those to people instead of other shares for sign up rewards. The shareholders would share the good and bad times together.
Could the company create a paid service that people could pay to have investments made for them? Or a service in which users of the platform can open the doors to follow/match their trades and pay a fee for doing so? Even a membership platform that would show all other membership holders % to date on past/current trades (+102% or -3%) and have a forum within that members can share trades for the day, week etc.
Could the company create a setup where members only can trade after hours?
Trying not to ramble on with ideas but personally speaking I love the platform, the community interactions and want to see it around for the next 25 years plus
I’m losing track if this is the 5th or 6th such topic on the same theme. most of those who came to T212 did so because it was free and will leave if that stops being true.
Trading212 has already clarified they won’t go to subscription system for clients. They aren’t public because they don’t have debt to pay off, and being public would mean they can’t do anything without getting approval from their shareholders. so all those nice new features and improvements in service we get? wouldn’t happen as a public company.
also it’s not T212 charging the deposit fee, they are just passing it along as of January, so hopefully more people would be understanding about that point before they claim T212 is no longer “free” .
just look at how little older public platforms change over a course of years and look at how T212 is rapidly growing and improving as a private company. shareholders would also only care about RoI so you could say goodbye to referral shares, hello to obscure fee’s and so long to expansion into new markets.
They have hinted at a multi-step model that is to continue on from the addition of fractionals and automation (in the form of pies), with a separate service that could be accessed for a fee, but we have yet to hear any specific details. It would be something tailored around improving our ability to make judgements in the market that justify the pricing.
Advice services are always risking because they would then become liable for your problems should things go south, so I can’t see that happening. something along the lines of L2 data et cetera perhaps?
as for the issues so far, none of them remotely suggest to me that T212 is having cashflow problems. the CFD issues are due to risk exposure in compliance with the regulator, the pie minimum adjustment is in relation to reducing strain on the infrastructure to ensure all transactions are handled as best as possible and the card fee’s are just a fee T212 doesn’t wish to cover further, likely in line with holding onto funds for the risk exposure on the CFD platform.
The company is by no means new. they have over 15 years in the market, and are fully capable of coming up with their own business model by people qualified to make the decisions for them.
our suggestions for how the platform should work will be both ill-informed and misguided as people on the outside. while they might like general idea’s and consider them, they won’t change course and drop everything due to a few of us making posts with limited to no information.
They are already in the process of making further adjustments and services, so beyond reporting problems with the services like errors, bugs etc we should just wait for news of their next update to drop.
the companies longevity was never in question
I do wish a few minor visual elements of the forums got suggested updates however. my eyes are complaining at having to use this white theme in the dark so often
What’s the further adjustments and services being spoke about? Would love to hear as I genuinely do love this platform and want to see it still operating in many years to come.
How long can you offer a free service for before it starts costing you more than your making? CFD is the main bread winner for company but as it stands, its not fully functional, so, if not fully functional can company still support itself?
the further adjustments would be the constant improvements to service that run in the background and features like pies, fractionals, automated investment, OTC market and access to new exchanges globally et cetera. the change to pie minimums would also count as it reduces the strain on the servers caused by clients so they have more leeway for growth of client base before needing to yet again scale up their infrastructure ‘en mass’.
as for the services, we don’t know yet, but they did tell us they have some in mind and are working on them. CFD is rather profitable so they can afford to provide the free accounts plus the free share scheme, now invest shares can be lent out for a bit of revenue as well and we will likely see other things onboarded that they can use for profit without charging us directly. only ISAs will remain a cash sink as regulations mean they can’t lend the shares out.
Not only are the provided services better than a year ago when I activated my ISA account, the scale of clients is also many times larger, which increases the platforms earnings to keep free services running. Once all their planned improvements are rolled out we may see the addition of many more account types, various ISAs and maybe 2 years down the line even a form of options trading may be provided as a source of income. as a rapidly growing private platform, T212 has a lot of potential to leave other European FinTech’s behind.
perhaps we may see a form of rebranding that helps the platform grow further in the invest side of things without any negative perception spilling over from the CFD side. a fair comparison I would like to make is like how Amazon can run so many loss-making services to customers in the ‘prime account’ sector of music, books, sales etc just because they are so profitable in another core part of their business to the extent that is 50% of all eCommerce occurring through amazon.
@Dao is absolutely right! I believe T212 is in a very sound financial position and the team has repeatedly said no to commissions, fees and subscriptions, they even pledged to do more and more without any costs! I remember one of the senior T212 member saying they are profitable for over a decade! That’s amazing, even Tesla isn’t (bad example lol)
The deposit fee charge is not going in their pocket, but it’s for the PSPs, plus you can always deposit via the free methods.
I do not believe the losses from CFD are significant, it was just difficult for them to keep hedging, always remember the house always wins more at the end of the trades.
I see that they are trying to optimize the platform even further and making it ready for new features the community has been requesting, so we may see some changes already happening.
Lastly, I also remember they are going to introduce a separate feature for cash management, where they would make extra income. So win win for T212 and clients. T212 already has several income streams but it’s always nicer to have more.
I don’t fully agree with this as I believe it would be a mistake in their overall long term strategy. Any company should expect that your users/clients needs evolve as they evolve.
With this in mind T212 needs to evolve their service to accommodate their clients future needs. I still hope in the future T212 would explore a different financing stream (maybe subscription based) to allow them to faster develop more advanced features (some of them already requested numerous times here on the forum) and avoid loosing users that are looking for those features.
As an example of this is an API access point (similar to what IBKR are providing) or custom indicators/charts (similar to TradingView) etc => features that not all users need, and most likely cost a lost of money to build and maintain. I am not willing (and most like most users feel the same way) to wait 5 years before T212 can manage based on their current cash flow to develop these features. As such I am using a competitor. I would be more that willing to pay what I am paying the competitor to T212 if that means that I can have access to these features in 1 year or so.
The point that I am trying to make is that the so called Independent Trader Movement is here to stay and new users have new expectations and I personally believe this will require brokers to adapt and improve their current products. The question is will T212 choose to be a leader and innovator in this new world or not? Only time will tell
I understand that. And fully respect their decision. And that is a correct decision.
I am not saying to paywall core functionality. I am saying develop other/new tools/features that only a niche user base needs, in order to avoid loosing these users and attract new users. Why? Because based on current data this niche of users hold a bigger amount of capital in their portfolio than your basic user.
Apple has the iPad Air for certain users and iPad Pro for other users based on their needs and different price points. I personally think that T212 should explore creating more products as not all of our needs are the same.
Maybe I am wrong. But currently I only hold about 5% of my portfolio with T212 because I feel I am missing some more advance feature that I truly need. Would move my full portfolio in a heartbeat if these feature would be added to the platform.
I personally hate paywalls those things have killed plenty of great services for me in the past.
those niche tools for a fee seems to be what they have indeed hinted at as a way for the additional funds.
The question boils down to just what exactly will they offer, how much will it cost and what’s the ROI for us
if the ROI is good enough I could probably justify myself up to about £100 annually in fee’s until my account is much larger and still maintaining the high ROI, then I could convince myself to pay more still.
Fully agree with this. As we are no longer talking about the core product, but an add-on product => it will need to achieve a very fine balancing act in order to make it work for us as customers and also work for T212
Looks like you really want to pay T212, you can ask support for their bank account and send them a Christmas gift on the behalf of us as all in addition to what you are willing to pay, T212 already provides A LOT for free what others charge for. It already serves the niche! Think about Pies, Fractionals, AutoInvest. Exotic exchanges are coming too. For free.
And they promised to add more for free, without cost. Then what’s your issue? They said that more money will not make it easier or faster for them to provide new features, it just needs time! They are profitable and have multiple revenue streams.
Apple is a very bad example. They make dirt cheap products and sell them at an extreme premium to unknowing customers, with each year removing one thing and calling it new. They are sitting on the most cash than any company in the world, that tells you what they are after.
But this thread is not about Apple.
In short, you’ll get all and more for free, you need to wait for them to develop, test and release new features. Thanking the team and staying with them will go a long way compared to a few quids a month.
Everyone is entitled to their own opinion. I believe all of these are coming for free for now as they try to onboard more users. In the long run if they have more users it does not automatically mean they will have the same cash flow they have now. And no matter what your opinion of Apple is they are a great business that has a lot of cash at hand and if 2020 has taught us anything (from a financial point of view) is that companies with great balance sheets will not always survive but actually prosper. And there are other examples besides Apple.
Again, based on my knowledge of business development, not having a revenue stream that would allow more R&D and faster deployment of features is a mistake. Time will tell if I am correct, but I would be more that happy to be proven wrong and see them manage to deliver everything mentioned here on the forum without asking for more money (via fees or subscriptions) Also most important deliver it in a timely manner. If they do it in 10 years personally I am willing to wait.
At any point T212 start charging fees like HL & AJ bell they will be mostly likely destined to fail as a business because they will loose their number one USP which is fee free service!!!
I started with many of my friends on HL & AJ bell and we’ve all moved to T212 simply because of the fee free service on Invest & ISA.
For less financially buoyant investors like us, paying fee makes a lot of difference!!!
There’s no doubt that HL & AJ bell with their Ross mould podcast offers a far more informative, user friendly and better platform than T212……but that’s okay because for the free service offered by T212 we are HAPPY with the trade-off .
I still have my accounts with HL & AJ bell where I kept little to money to avoid them closing it and so I get all the information’s from both brokers and invest my money on T212 platform because of the free services
I do believe that the market T212 attracts is not the same as that of HL & AJ bell. Big time investors can afford to pay fees without making any difference but for small time investors it makes a lot of difference!!!
There’s no need to fix something that isn’t broken…if you can afford fees then go to fee charging brokers!!!
We are in the middle of a global pandemic whereby many lives have been lost and many families are going through the most difficult times financially. This discussion could not have come at a worst time to upset people’s new years eve/new year depending on where you reside.
I do hope this isn’t T212 trying to test people’s reaction on weather to start charging fees.