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The Problem with Traditional Fintech- BaaS -
Sponsor Bank Ecosystem
All-or-Nothing Dependency on Sponsor Bank(s)
Results in significant risks to your speed-to-market and ongoing business continuity
Your operations rely on the approvals and ongoing support of your sponsor bank(s) (typically a single sponsor bank). If your Baas provider is unlicensed and therefore cannot be in the flow-of-funds, your sponsor bank(s) must support all your accounts and financial services. It's all-or-nothing.
Sponsor banks can abruptly limit or cease to support your new services, often triggered by exponential growth in financial and regulatory risk, stemming from the increasing volume of fintechs and users, as well as the breadth and complexity of expanding fintech offerings and use-cases.
Modular Banking is a Game Changer for Fintechs
Modular Banking changes the game for fintechs, eliminating the risk / reliance on one or few sponsor banks
By introducing multiple sponsor banks, each providing overlapping and modular services accessible to all fintechs platform-wide, our licensed BaaS platform uniquely makes the entire ecosystem more reliable with less risk.
Benefits of Modular Banking for Fintechs
Reduces friction and increases onboarding speed of consumers and businesses, through built-in KYC, KYB, and AML compliance frameworks.
Enables best-of-breed bank services - Sponsor Banks specialize and provide only their fintech-optimized services through our platform.
Reduces risk of business disruption due to bank sponsors. Multiple sponsor banks providing overlapping and specialized modular services eliminates single points of failure and enables bank partner portability.
Enables choice to bring your own bank partner - for certain modules of your choice (like BIN sponsorship), incremental integrations with partner banks are much easier for both the sponsor bank and Synapse.
Enables support for new features or products, at speed and at scale. No All-or-Nothing dependency on one or few banks to hinder new product introduction and scaling.
Modular Banking is possible only through a licensed and
regulated BaaS platform provider like Synapse.
Synapse Brokerage LLC is a registered broker-dealer and member of FINRA and SIPC. As a result, Synapse can participate directly in the flow-of-funds and thereby, segment and distribute core services across multiple sponsor banks, yet deliver these services as unified solutions to its customer fintechs and their end-users.
In addition, through our lending entity, Synapse Credit LLC, we are able to underwrite and originate loans for individuals and businesses in designated states without needing a sponsor bank. This approach enables us to build a much more modern stack for our fintech customers as well.
