Custodial accounts: Keeping the funds deposited through the Raisin platform secure

One of the joys of having a Raisin account is the simplicity of a single login to manage all of your savings accounts.

Typically, in order to open accounts with multiple banks and credit unions, you would have to spend a lot of time researching each institution, share sensitive information with each one, and then manage all of the associated account logins and paperwork.

In contrast, when you create a no-fee Raisin login, you can browse top rates from a network of federally insured banks and credit unions, then open and manage new accounts all from a single dashboard.

That leaves the question: how does Raisin work?

It may sound like magic, but it really all comes down to custodial accounts.

• What is a custodial account?

• Are custodial accounts safe?

• What else do I need to know about custodial accounts?

Custodial accounts are basically a financial account that one person or party opens and maintains for the benefit of another person. For example, a common type of custodial account is that created by a parent or guardian for a minor child.

In the case of Raisin, our goal is to keep your funds as safe and secure as possible. To do so, we work with federally insured banks that act as the custodians of your funds. These custodian banks open accounts at each of our partner banks or credit unions and hold the funds there for the benefit of our customers.

This means that Raisin never touches your funds and that all funds in the Raisin platform are always held by a federally insured financial institution. When you make a deposit, that money is directly transferred from your bank to a custodial account at the financial institution offering the product you selected.

Custodial accounts have existed for decades in the U.S. banking system and are protected by multiple fail-safes at each institution to ensure your funds remain safe.

Individual holdings within each custodial account are identified by a unique customer ID number and are accounted for in both Raisin’s records as well as a daily file we share with the custodian bank. This means that the custodian bank always has a record of all customers’ balances across all of our partner banks and credit unions.

Additionally, because all of Raisin’s partner banks and credit unions are federally insured and because funds in custodial accounts are held on behalf of Raisin customers, these funds are covered by pass-through deposit insurance. This means that the same $250,000 per depositor, per institution insurance limits apply and those funds are covered in the unlikely case of a bank or credit union failure.

Besides reading, understanding, and agreeing to the Custodial Agreement as part of opening a Raisin account, that’s about it!

The simplicity of the Raisin platform means that all of the financial intricacies are handled by our platform, meaning you have more time to focus on ensuring you’re reaching your own financial goals and that your savings are growing at competitive rates — all while being covered up to per-institution deposit insurance limits.

Haven’t started your savings journey with Raisin yet? Click below to view our current top offers, sign up for an account in minutes, and begin earning more from your cash.

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