ABN AMRO Clearing is pleased to confirm the launch of a new infrastructure for business clients such as brokers to support fractional investing by their end clients.
As explained in the update from ABN AMRO (AMS: ABN), fractional investing is “a method of investing in part of a share, instead of needing to buy a full share.”
Neobroker BUX is ABN AMRO Clearing’s first customer to begin using this new feature. Since early January, customers of BUX might “spend 10 euros to buy a fractional share in Tesla, for example.”
As noted in the announcement, the new infrastructure has been “an immediate hit, and BUX’s clients have already made over ten thousand fractional investments during the first nine days of the new feature being available on BUX Zero.”
In the US, fractional investing has been “around for some time, and has become hugely popular,” the update revealed. A few European brokers utilize the US infrastructure. Given the legal and supervisory hurdles that this involves, however, “eighteen months ago ABN AMRO Clearing started work to develop its own infrastructure to offer in Europe.” Following its launch earlier this month, the new service will “soon make fractional trade possible in European shares too.”
Banking as a Service
It had already been possible for customers of brokers like BUX to handle their investments from a bank account with ABN AMRO Clearing (Banking as a Service). Now, they are able to use their accounts to purchase and sell full shares and fractional shares. An innovative cloud-based administration system “keeps meticulous track of what fractional purchases an investor has made, without ABN AMRO needing to buy more than one additional full share per fund,” the update explained.
Smart technologies
Smart and reliable technologies are “creating more and more opportunities for customised investor services.”
Rutger Schellens, CEO of ABN AMRO Clearing, stated:
“We are active in the business-to-business segment and offer services to retail brokers such as BUX. These innovations help us to retain clients and further boost our impact and income.”
Yorick Naeff, CEO at BUX, remarked:
“The launch of fractional investing marks an important new chapter in the normalisation of investing in Europe. As the first Dutch broker to offer fractional investing in individual stocks to retail investors, BUX continues to lead the evolution of neobrokerage in Europe.”