New banks

Acorns automatically jacks-up fees on subscribers paying $1 per month

  • Acorns is approaching going public via a SPAC.
  • The firm recently told customers in its lowest subscription tier that it was raising their fees by 3x.
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Acorns automatically jacks-up fees on subscribers paying $1 per month

Micro-investment service Acorns has raised pricing on its lowest subscription tier from $1 to $3.

What’s happening: Acorns Lite members will be automatically upgraded to Acorns Personal accounts and billed $3 per month, instead of $1. The change will be applied September 21.

Acorns subscribers recently received emails alerting them to the upcoming changes.

Source: Frequent Miler

For some, the news wasn’t taken so well. People were bothered by the tripling of fees for a micro-investing service used to round up small dollar purchases. With $4.7 billion AUM and 4 million customers, the average Acorn investment account has just over $1000. For these accounts, $36 a year to invest in low cost ETFs is quite costly.

Others disliked the automatic opt-in approach the firm took with customers. “You do not need to take any action,” read the email the firm sent out. Customers “experiencing economic hardship” can request to stick with the $1 subscription option

In May, Acorns announced plans to go public via a merger with a SPAC. The deal values the fintech at $2.2 billion.

  • After the deal is closed, the company will operate as Acorns Holdings, trade under the ticker OAKS, and will continue to be led by CEO Noah Kerner.
  • Kerner plans to contribute 10% of his personal ownership in Acorns to fund a program giving shares to eligible customers. 

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