Zero-commission trading app Robinhood is facing technical difficulties as it transitions away from Apex Clearing onto its own “Clearing by Robinhood” clearing system, according to a status update. As of Wednesday morning, the trading platform cited “Degraded Performance” on payout of its dividends.
A support note Tuesday at 12:51 p.m. PST said the service was supposed to have paid out dividends by the end of day, yesterday. By press time Wednesday there were still dividends that had not been paid, according to the firm, although the social media account of its investor support system, Robinhood Help, noted a “substantial amount” of pending dividends had been paid Wednesday morning. Dividends are subject to a weekly sweep from Apex to Robinhood’s in-house system, which can cause an investor to experience delays in their account being credited with dividend payments. The platform doesn’t have a dividend reinvestment plan.
The clearing process faces an additional layer of complexity and scrutiny beyond simply executing trades. FINRA’s social media account had already responded to one of the comment threads on the Robinhood Help social media account. A request for more information on the nature of the service outage was not immediately returned.
The company was valued at $5.6 billion in May and said it has more than six million customers.