JP Morgan up their fintech game with new investing app

Consumer-friendly fintech is on the rise. US banking giant JP Morgan Chase has launched a low-cost digital brokerage platform, which will be available to the bank’s 47 million online customers. You Invest is available to anyone who uses JP Morgan's online banking platform or downloads their mobile banking app. The new brokerage feature will allow customers to make up to 100 free stock, bond, mutual fund or ETF trades per year.

The app also offers access to JP Morgan’s stocks research and a handy portfolio building tool. The initiative aims to engage with current customers and attract tech-conscious millennials.  Jefferies analyst Daniel Fannon and Gerald O’Hara wrote “we view this as an ancillary product for JPM and a means of gaining a greater share of its existing banking clients’ wallet.” “We do not view this as much a threat to existing brokerage clients … but more likely to have an impact on new account growth over time (i.e. millennials).”

JP Morgan will charge $2.95 a trade for those customers who exceed 100 trades in a year. The decision sits as a swift reversal for the same bank that charged $24.95 for online trades last year. Chase Private Client customers with at least $250,000 in holdings will receive unlimited trades.

The bank is reportedly targeting people with a Chase account but investments elsewhere, as well as people who have never invested before. There is a perception that trading is expensive for those who are new to the field. Kelli Keough, global head of digital wealth management, told CNBC "we wanted to lower the hurdles. We wanted to help people invest without cost being an issue, and to reward people who are doing more business with us."

According to Keough, You Invest users are 15 years younger than clients of the bank’s human financial advisors on average. In addition, an overwhelming 90% of users have never invested with JP Morgan in the past. Rival trading app from RobinHood Markets currently holds a $5.6 billion valuation and 5 million users.

Nevertheless, JP Morgan has a distinct advantage above its competitors as the US' biggest bank, boasting an incredible 47 million online customers.

Interested in the past and future of fintech? Listen to our podcast with fintech expert Ying Panagiotou, head of trading at Capital.com