In the digital age it is easier than ever to invest. With the ability to purchase fractional interest in shares and ETF portfolios at our fingertips, it’s no surprise that platforms like Raiz (ASX: RZI) have skyrocketed to the top spots in app stores.
The popular microinvesting platform has just hit $1 billion in funds under management, a major milestone that reinforces the palatability of the overall concept.
The completely mobile app has made entering the market easy for many people. Chock full of resources like recommended readings and a future projections feature, Raiz is as much an education platform as it is an investment app. With over 500,000 Australians using the app to invest and save, with average balances having grown to nearly $3,000 per customer and the app has amassed over 2.3 million downloads.
The platform was built on the concept of investing your spare change. Still a prominent feature, the app rounds up purchases to the nearest whole dollar amount and invests the difference. Automating the process makes investment decisions seamless, and if you’re like me, one day you open the app and have over $1,500 in there! ($300 more than I had before thanks to regular dividend payments.)
Since launching in 2016 Raiz has added multiple features such as a super offering, an option to start an account for your kids, and Raiz Rewards; a cash back scheme where shoppers can earn a percentage of their purchase with affiliated brands back as money invested into their account.
The app offers multiple portfolios based on risk profiles as well as their ‘Emerald’ ethical portfolio and ‘Sapphire’ portfolio which has exposure to cryptocurrency. There is now an option to create a custom portfolio, giving the app longevity of use as investors become more sophisticated.
Commenting on the $1 billion milestone, Managing Director and Joint Group CEO, George Lucas said: “Passing this significant milestone is a huge validation of the Raiz business model, products and brand, which has helped more than 500,000 Australians invest and save.
“Seven years ago, the concept of an investment app accessible to anyone on a smartphone and as little as $5 to invest was no more than a pipe dream. The Raiz team has worked hard to make this dream come true- and you can see what has been achieved as we pass the $1 billion milestone in Australia.
“I am proud that every day we’re improving the financial experience, education, and literacy for a broad segment of Australians, Indonesians and Malaysians, which has and will continue to be an essential part of our purpose.
“Reaching this $1 billion milestone reinforces that we’re delivering on our customers’ expectations. They continue to entrust their money with us, and we appreciate their support and loyalty, and the valuable feedback they provide on ways to improve our product.”
A notable factor in boosting funds under management is likely to have included Raiz’s introduction of the ‘Sapphire’ portfolio in May 2020 as a vehicle for users to invest in cryptocurrency. At the time of it’s introduction, Bitcoin was valued at USD $8,700 but just 18 months later, it is trading around $65,000. Other major financial institutions are now following suit as evidenced by Commonwealth Bank last week confirming they would commence offering similar crypto investing services, albeit well after the bar was Raiz-ed.
Samantha Freidin is a business journalist at Emerald Financial whilst also completing a Masters of Marketing and Digital Communications at Monash University.
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