Fixed-income investing app Blossom recently launched its Grow offering, which provides investors with a targeted return of 7 per cent a year.
Blossom Grow has a fixed term of 12 months and no account fees. Blossom co-founder Ali Rosenberg indicated it was designed for customers willing to put their cash away for longer.
“We’re creating a home for those looking for longer-term savings, building for money that investors are ready to park while they save for a purpose,” Rosenberg explained.
The product was introduced in response to customer demand and expressions from this cohort of their want to commit funds for longer periods if the return was worthwhile.
Blossom already offers fixed-income options Blossom Save, targeting a 5.7 per cent a year return with a minimum investment of $50, and Blossom Plus, aiming to generate an annual return of 6.5 per cent on investments starting at $5000.
“Savers were already mentally separating their money into ‘what I might need soon’ and ‘what I can set aside’. Grow formalises that second bucket – it’s the set-and-forget portion,” Rosenberg said.
“The advantage of Blossom Grow for investors is accessibility and simplicity. There is no trading, no charts, no constant decisions – just a clear plan that works for you in the background, with a return you can expect to be more consistent.”
The manager has noticed more investors are looking to make money put aside for large purchases, such as home deposits, earn better returns for the duration of that savings timeframe.
The app’s investment options have been specified to be suitable for individuals, businesses, charities and SMSFs.
Blossom Grow funds are invested in the Blossom Fund fixed-income portfolio where the underlying investments consist of global investment-grade bonds and government or government-related bonds. It is managed by investment manager Gleneagle Asset Management.
“Customers are getting access to a portfolio that would traditionally be much harder for retail customers to access directly,” Rosenberg noted.
Blossom Grow was soft launched a month ago and already has witnessed close to $5 million of inflows from investors who have an average balance of around $20,000. It has a minimum investment amount of $5000.
