The Fully Paid Lending Program (FPLP) is a common practice in the stock market where we temporarily lend your complete shares to other entities, such as banks or market makers. Despite lending your shares, you remain the owner of your assets during the loan period.
Why Hapi Participates in the Fully Paid Securities Lending Program?
In the case of Hapi, the Fully Paid Securities Lending Program allows our Clearing Firm Apex to lend complete shares of our clients to other entities to generate income. This enable commission-free trades for our users. In this process, a portion of the interest generated by the share loan is shared between Hapi, Apex (responsible for managing the program), and you, the client, receiving a 5% return.
☝Important Note: At any given time, only a minimal percentage (around 4%) of assets in Hapi are lent as part of the FPLP.
How does this affect your account?
You will always own your shares and can sell them whenever you want. However, if we lend your shares, they may not be covered by SIPC protection. Therefore, our partner Apex is obligated and provides guarantees to cover in the unlikely event of a loss.
What happens if Apex doesn't return my shares?
Apex maintains a 100% guarantee of the value of the lent shares to protect investors in case of contingencies. In the unlikely event that they do not return your shares, this collateral serves as a resource in your favor.
Can I exit the program?
Yes, you may do that by sending us an email asking to opt-out of the FPLP program or by closing your account at Hapi. Keep in mind that Hapi uses the proceed from the FPLP to make money and fund its commission light business.
Do I receive returns for the lent shares?
Yes, as a client, you receive a 5% return of the interest generated by the loan of your shares.
Still have questions about the Fully Paid Securities Lending Program? You can contact our support team here. We're here to help!