Freetrade to more than double FX fees for free accounts amid profitability push

The UK’s first commission-free stock trading platform has been undergoing a shift in its strategy away from growth toward sustainable revenue generation.

Commission free stock trading platform Freetrade is set to increase its fees amid a push to profitability.

Freetrade will double the fees it charges on foreign exchange, needed when buying or selling US or euro-denominated stocks. 

From 11 April, FX fees will rise from 0.45 to 0.99 per cent on its entry-level free plan.

Freetrade also has two paid-for premium plans, Standard & Plus. FX fees for these will rise to 0.59 per cent for the Standard accounts but fall to 0.39 per cent for the Plus account.

The two plans will also see an increase in their monthly costs from May to £5.99 per month for Standard and £11.99 per month for Plus.

Freetrade will however keep the current charging levels for customers switching their plans to annual payments as it seeks to encourage more 'stickiness' from its customers.

The moves come during a broad fintech push for profitability that began during a seismic macroeconomic shift at the start of 2022.

Interest rates set by central banks began a long-awaited period of ‘normalisation’ last year. In other words, they started to trend upward back towards levels not seen since before the 2008 financial crisis.

This prompted something of a sea change for investors, forcing many fintech startups - and other high-growth but lows making sectors - to augment their strategies from growth toward sustainable revenue generation.

Founded in 2016 by CEO Adam Dodds, Freetrade has grown quickly, particularly during the pandemic, but more recently has been talking to advisors about a potential sale. 

This follows laying off 15 per cent of staff last summer in a bid to extend its 'runway'.

The company’s last annual results, for the period up to 30 September 2021, show losses also almost doubled to £18.2m from £9.5m in the previous year alongside soaring revenue growth of £12.7m from just £1.7m the previous year.