Stash launches Stock-Back, a cash-back rewards program that bridges savings and investing
- Stash's popular investing app will offer cash-back on spending in the form of stock.
- Stock-Back will automatically build portfolios of the companies where customers spend money.
Stash has unveiled its own flavor of cash back rewards program. Stock-Back automatically invests in the companies where Stash debit card holders spend money. So, if a Stash user shops at Amazon, she’ll accrue factional shares in AMZN. If he eats at McDonalds, he’ll automatically become an MCD shareholder.
“Our ability to give customers the opportunity to save and build portfolios that mirror their spending behavior and preferences is incredibly powerful,” said Stash co-founder and president, Ed Robinson.
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Stock-Back has been in a limited beta release for the past few months and Robinson told Tearsheet that Stash made over 100,000 allocations of stock rewards during this period.
Stock-Back rewards are tiered:
- 5 percent stock-back at Netflix and Spotify
- 2 percent at Starbucks and Dunkin’
- 12.5 basis points for all other swipes or 25 bps if a customer has direct deposit turned on in her Stash account
“We’ve seen so much interest during the testing period for Stock-Back,” he said. “It creates so much community and social sharing. Our users are changing the way they spend, building portfolios, and telling other people about it. Those people are coming to us, asking if they can get access to Stock-Back, too.”
Stash gets into banking: Along with its reward program, Stash is officially launching banking services. Powered by Green Dot’s Banking as a Service Platform, Stash users will get access to a debit account with no overdraft or monthly maintenance fees, as well as ASAP Direct Deposit which enables customers to get paid up to two days early.
“In the U.S., people aren’t used to receiving any rewards from their debit cards,” Robinson said. “The most powerful thing to Stock-Back and using the Stash debit card is you get dividends, build a portfolio, and get access to growth just by living your life.”
Unifying financial services: By offering a bank account, Stash continues to blend the lines between banking and investing. To help people save and invest more, the popular investment app recently added services like rounding up purchases to sweeping cash to an investment account. As Stash moves into banking, it mirrors the moves of challenger banks that are expanding their offerings into investing.
Robinson frequently cites the statistic that 80 percent of Americans live paycheck to paycheck. It’s these people that Stash is designed for.
“How do you break this trend? With technology, education, and removing fees,” he said. “A bank account and investment account should naturally sit next to each other. When you spend less one month, you should be moving money into your investment account. When you help the average American put a few bucks away every month, you start to beat the statistics.”
Also, kaching: Stash also announced a Series E investment of $65 million. The funding will be used to increase product growth and propel brand awareness.