Nithin Kamath says Robinhood makes Rs 1,300 crore from just instant withdrawals, calls US banking system ‘broken’

Zerodha co-founder Nithin Kamath on Tuesday drew a sharp comparison between India’s payments infrastructure and that of the United States after revealing that US-based brokerage Robinhood earns nearly Rs 1,300 crore ($150 million) every year just from fees on instant withdrawals.

In a post on X, Kamath said Robinhood’s cost to process these instant transactions is around $35–40 million, leaving the company with a profit of about $100 million, or nearly Rs 900 crore, purely from this single non-core feature. “That’s just from instant withdrawals,” Kamath wrote, calling the number “shocking.”

He said such income streams are the kind of revenue that Indian founders dream of achieving from add-on services beyond their core products.

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“As an Indian startup with some scale, founders dream of generating revenue like this from non-core products. Hence the rush to introduce everything: loans, insurance, payments, and other financial services,” Kamath said. “But nothing really works outside the core offering.”

Kamath pointed out that while US startups can earn huge sums from optional features like instant withdrawals, Indian fintechs find it hard to monetise add-ons because local customers are unwilling to pay extra. “It just shows how far behind India is compared to the US when it comes to customers willing to pay for add-ons,” he said.The Zerodha founder also expressed surprise that American users pay as much as 1.75% in fees per transaction for instant withdrawals. “This really shows how broken the US banking system is,” he said. Despite being home to some of the world’s biggest financial institutions, the US still doesn’t have a universal real-time payment system, forcing most fund transfers to take a couple of days to complete.In contrast, Kamath said India’s digital payments ecosystem, led by the Unified Payments Interface (UPI), allows instant and cost-free money transfers for millions of users and businesses. He highlighted that Zerodha, one of India’s largest stockbrokers, doesn’t charge its clients any fee for deposits or instant withdrawals.

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“For comparison, we don’t charge Zerodha clients for deposits (thanks to UPI) or instant withdrawals,” Kamath said, adding that the company has processed over Rs 50,000 crore in instant withdrawals in less than two years, all at zero cost to users.