Freetrade increases monthly fees for its Standard and Plus customers just months after introducing a new pricing structure
- Freetrade introduced a three-tier subscription last summer
- It increased prices for its Standard customers by 66%
- Now clients are faced with a further monthly increase and higher FX costs
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Do-it-yourself investment app Freetrade will soon raise its monthly fees, just months after introducing a new three-tiered plan that boosted prices for its Standard customers.
Last summer, Freetrade introduced three plans — Basic, Standard, and Plus — which saw Standard customers experience a 66 percent rate increase.
But despite the price increases, the popular platform remains free to use for those who opt for the most basic service, which does not offer Isa shares.
free trade* basic plan remains unchanged and is free for anyone with access to a general investment account, commission-free trades, and access to over 1,500 global stocks and ETFs.
The Standard plan, which includes an Isa, now goes from £4.99 to £5.99 per month, while the Plus plan, previously £9.99, costs £11.99 per month.
Up: Freetrade’s Standard and Plus customers will pay more each month if they don’t opt for annual billing
But Freetrade customers can keep the original lower cost if they pay an annual fee of £59 or £119 upfront for the Standard and Plus plans respectively. The changes will take effect from customers’ billing date in May.
The investment platform previously told This Is Money there were no plans to increase fees, but CEO Adam Dodds said the environment had changed.
‘When you spoke to us [in 2021], it was before we revised our plans. I don’t think the interest rate environment was the same as it is now,” he said.
“It seems pretty reasonable in the current environment that you would see a small increase in this plan.
“And then we give our customers an option to keep their current rate if they don’t mind paying up front because of course that gives us more security around revenue as a company, so it’s kind of a win-win in that way.” win situation.
“If you want to keep your current rate, sign up for annual billing… Your annual rate won’t change.”
The steepest new Freetrade costs come in the form of FX costs, as the foreign exchange costs of buying foreign stocks are known. Basic customers face an increase from 0.45 percent to 0.99 percent.
The average Basic customer order is around £30, meaning customers will pay around 30p instead of the current rate of 14p.
The fee for Standard clients will be increased from 0.45 percent to 0.59 percent and the FX fee for Plus clients will be reduced to 0.39 percent.
These changes take effect on April 11.
Freetrade attracted customers with its free trading offerings and saw major growth in the boom in trading and investing during the lockdown. The free model, alongside rival investing apps like Trade 212 And eToro*shook up the DIY investment market.
In response, established players have been adjusting their offerings over the past year. AJ call* launched its own app for profitable investing Dodl, while Interactive investor* recently launched a new lower £4.99 per month option for those with less than £30,000 invested.
How does Freetrade compare? Read our guide to the best investment platforms.