Fully Paid Securities Lending (FPSL) allows eligible securities that you fully own to be loaned to qualified borrowers in exchange for potential lending income. If your shares are in demand, they may be loaned through the program and you may receive a portion of the revenue generated from the loan.

Do I still own my shares?

Yes, you still maintain economic ownership and you can partially sell your shares, or sell in full, at any time.

How do I earn income?

If eligible securities in your account are loaned, you may receive lending income. The amount you earn depends on factors such as market demand and borrowing rates, which can change over time. Earned income is automatically deposited into your account on a monthly basis, the following month.

Which securities are eligible?

Eligibility is determined by market demand and program requirements. Not all securities can be loaned, and participation in the program does not guarantee that your shares will be borrowed.

Can I leave the program?

Yes. Participation is voluntary, and you can opt out of the program by visiting the Account section within the app.

How are dividends handled?

While a security is on loan over a dividend record date, you receive a “payment in lieu of dividend” instead of the dividend itself. These payments are generally taxed as ordinary income rather than at the qualified-dividend rate.

Are there any risks?

Yes. Key risks include:

  • No SIPC protection while on loan. Shares that are out on loan are not covered by SIPC for the duration of the loan.

  • Counterparty risk. The borrower may fail to return the shares; collateral is held to reduce this risk.

  • Loss of voting rights. You generally cannot vote shares that are on loan over a record date.

Please review the FPSL agreement and disclosures in full before enrolling.