Swedish regulator gives Freetrade the green light to launch products to investors as DIY platform makes its first steps into Europe
- Swedish regulator authorises Freetrade to offer its product to investors
- Investors will have commission-free access to thousands of stocks and ETFs
- The approval marks the platform’s long-awaited move into Europe
The Swedish regulator has given Freetrade the green light to offer its products to investors, paving the way for its long-awaited expansion across Europe, This is Money can reveal.
The Finansinspektionen recently authorised Freetrade to offer its product to Swedish retail investors, meaning investors in the Scandinavian country will now have commission-free access to thousands of European, UK and US stocks and ETFs.
Freetrade Sweden will also look to offer local investors an ISK account in the coming months – which is the Swedish version of an Isa.
Freetrade Sweden, led by Karl Broomé, has been granted approval by the Swedish regulator kickstarting the platform’s move into the continent
The platform plans to launch a closed beta for those signed up to the waitlist in the coming months, before rolling out to the general public.
Freetrade has long talked of a move into Europe, having incorporated a separate entity in Sweden last year.
Its chief marketing officer Victor Nebehaj told This Is Money last year: ‘We chose Sweden… because it has a very reputable regulatory jurisdiction and not a lightweight one’.
Regulators in both Europe and the UK have started to crackdown on what they deem as the ‘gamification’ of investing as well as crypto investing more broadly.
Where Freetrade does have the regulatory upper hand, particularly across Europe, is that it does not use payment for order flows.
The European Commission is set to ban the practice, which sees brokers receive payments from third parties for directing client order flow to them as execution venues.
While the Swedish regulator’s approval marks a significant step in Freetrade’s European expansion, it will still need to apply to each regional regulator in the EU.
However it is understood that because of passporting the approval is likely to speed up the process.
While the investment platform has captured a significant portion of the UK market, Freetrade will now be vying with rivals like Sequoia-backed Trade Republic and eToro.
Earlier this year, Freetrade struck a deal to offer its customers direct access to the German stock exchange via CBOE and Equiduct, usually reserved for institutional investors, rather than using the CREST system which charges a fee.
It followed the arrival of Finnish stocks on the platform in December 2021 and users can now also trade Dutch, Swedish, Portuguese and Austrian shares on the platform.
Freetrade has expanded at a rapid pace since its launch in 2018.
It has built a loyal following in large part because of its referral system which promises a free share worth up to £200, which has helped push customer numbers to over 1million.
That has met the attention of the Financial Conduct Authority, which last month said is considering banning refer-a-friend bonuses or new joiner giveaways. It is currently in consultation stage.
Its valuation has also doubled from £270million to £650million in under a year.
Trading volumes in 2021 soared 313 per cent while revenue was up 647 per cent, according to recent figures.
Karl Broomé, managing director and Freetrade’s head of Sweden, said: ‘I am thrilled to be able to share our mission to get everyone investing in Sweden.
‘This development is testament to the hard work of our team and we’re looking forward to evolving the way retail investors in Sweden, and eventually, across Europe, access global stock markets.
Adam Dodds, Freetrade founder and chief executive added: ‘There is a massive opportunity for our business to offer European retail investors a low-cost and simple way to invest for the long-term.
‘We’ve always put our customers’ first in everything we do, and we’re thrilled to now be able to bring this to the rest of Europe.’
Compare the best DIY investing platforms and stocks & shares Isa
Investing online is simple, cheap and can be done from your computer, tablet or phone at a time and place that suits you.
When it comes to choosing a DIY investing platform, stocks & shares Isa or a general investing account, the range of options might seem overwhelming.
Every provider has a slightly different offering, charging more or less for trading or holding shares and giving access to a different range of stocks, funds and investment trusts.
When weighing up the right one for you, it’s important to to look at the service that it offers, along with administration charges and dealing fees, plus any other extra costs.
To help you compare investment accounts, we’ve crunched the facts and pulled together a comprehensive guide to choosing the best and cheapest investing account for you.
We highlight the main players in the table below but would advise doing your own research and considering the points in our full guide linked here.
|Admin charge||Charges notes||Fund dealing||Standard share, trust, ETF dealing||Regular investing||Dividend reinvestment|
|AJ Bell YouInvest||0.25%||Max £3.50 per month for shares, trusts, ETFs.||£1.50||£9.95||£1.50||1% (Min £1.50, max £9.95)||More details|
|Bestinvest||0.40% or 0.2%||Account fee cut to 0.2% for ready made investments||Free||£4.95||n/a||n/a||More details|
|Charles Stanley Direct||0.35%||No platform fee on shares if a trade in that month and annual max of £240||Free||£11.50||n/a||n/a||More details|
|Fidelity||0.35% on funds||£45 fee up to £7,500. Max £45 per year for shares, trusts, ETFs||Free||£10||Free funds £1.50 shares, trusts ETFs||£1.50||More details|
|Hargreaves Lansdown||0.45%||Capped at £45 for shares, trusts, ETFs||Free||£11.95||£1.50||1% (£1 min, £10 max)||More details|
|Interactive Investor||£119.88 as £9.99 per month||£7.99 per month back in trading credit||£7.99||£7.99||Free||£0.99||More details|
|iWeb||£100 one-off||£5||£5||n/a||2%, max £5||More details|
|Freetrade||Free for standard account £3 month for Isa||Freetrade Plus with more investments is £9.99/month inc. Isa fee||No funds||Free||n/a||n/a||More details|
Only Vanguard funds
|Free||Free only Vanguard ETFs||Free||n/a||More details|
|(Source: ThisisMoney.co.uk July 2021. Admin charges quoted annually, may be monthly or quarterly)