Wednesday, 31 January 2024, Bengaluru, India
Like how apps like Robinhood simplified stock investing, Finvest aims to do the same for US Treasury Bill investing.
(Image Source: Techcrunch.com)
In 2023, Get Moving’s co-founder and CEO, Shivam Bharuka, began working on Finvest. He told TechCrunch that Bharuka wanted to take advantage of the atmosphere because interest rates were so high, but banks were only offering pennies on the dollar.
“With U.S. Treasury Bills, you can earn free money on idle cash due to the high-interest rates.” However, Bharuka stated that purchasing Treasury Bills is currently tricky. “You can use the traditional brokerages like Fidelity or Charles Schwab or purchase them through the government website Treasury Direct, which is a throwback to the 1990s. These encounters frequently have a clumsy user interface and are opaque. You can also not invest in underlying fixed-income securities using most contemporary fintech apps.
Although he was a Winter 2023 Y Combinator batch member, Bharuka first applied with an Indian logistics startup. He ultimately made a 180-degree turn after realizing the drawbacks of purchasing Treasury Bills.
He is building Finvest with his team to automate the process of buying, managing, and selling US Treasury Bills. Pershing Advisor Solutions LLC, a Bank of New York Mellon Corp. division, is the brokerage business driving this effort.
This explains its operation: Installing the iOS or Android app allows users to sign up, link their bank accounts, and start making deposits. The verification process for opening a brokerage account usually takes a day. But Finvest makes it possible for the deposit to be tied up so that the trade will begin to process as soon as the account is approved.
In addition to monthly management fees, Finvest charges a flat monthly management fee of 0.03% on the average daily market value of your Treasury assets.
It’s not just Bharuka who wishes this process were more straightforward. With support from Sequoia, Zamp Finance offers a treasury management platform that facilitates more accessible access to US Treasury Bills. A high-yield cash management account from Finvest, which provides a 4.4% yield—higher than other savings accounts—sweetens its offering.
Although Bharuka declined to disclose the number of users who have downloaded the app, the company is still in its infancy. Since the app’s introduction in December, about $1 million in deposits have been made.
Additionally, it has already secured $2.7 million in funding from a consortium of angel investors that includes Oliver Jung, a former CEO of Airbnb, as well as investors from Bayhouse Capital, Unpopular Ventures, Y Combinator, Olive Tree Capital, Pioneer Fund, and Fractal Ventures.
With the money, Bharuka hopes to grow the technical staff at Get Moving and eventually incorporate more asset classes—like corporate and municipal bonds—into the Finvest app.
He added, “We also intend to launch this internationally.” We have been looking at this topic since there is a lot of interest in investing in treasuries, particularly in Latin American nations like Brazil and Argentina, where the economies could be doing better. They wish to invest in a more robust economy, but there currently needs to be a more accessible method.
(Information Source: Techcrunch.com)
Hi, I am Subhranil Ghosh. I enjoy expressing my feelings and thoughts through writing, particularly on trending topics and startup-related articles. My passion for these subjects allows me to connect with others and share valuable insights.
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