Donna Blum

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135 appearances 1 recordings 1 series first heard Mar 2025 last heard Mar 2025

Donna Blum’s voice in public audio — every appearance, attributed to the second.

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Off the Rails from the U.S. Faster Payments Council - FPC · 13 March 2025 Tony Cook from First Bank and Donna Blum from BHMI on payments reconciliation · 13 Mar 2025 podcast

Well, I think that there's one specific thing that comes to mind that's in the

quite in the news quite a lot right now, and that's the collapse of Synapse.

A lot of people in the industry are at least somewhat familiar with what happened there.

But if they're not, I'll give you a quick little snapshot of it.

So from what I read about that situation,

Synapse was a BAS service provider and it offered services to fintech startups.

Now the fintechs basically wanted to provide banking services to their clients, but they needed a partner bank that possessed a banking license to do so.

So what happened when they filed bankruptcy last April, it really opened up a huge can of worms.

From what I've read, they failed for two reasons.

First of all, it was due to the mismanagement of their FBO, or what's known as for benefit of accounts.

Synapse had issues with their internal ledger system, which resulted in inaccurate reporting of customer funds

and a wide discrepancy between the account balances that they reported and the actual amounts of funds that were held by their partner banks.

I read somewhere that it was as much as a $95 million shortfall in funds that Synapse handled in their ledger system and the actual amounts that the partner banks held.

So the second reason is they lost their largest client.

When Mercury decided to work directly with Involve instead of using Synapse, it immediately triggered a significant rate revenue loss for the company.

And so that kind of led to their demise.

But ultimately,

The collapse of Synapse revealed limitations in regulations for banking as a service providers, particularly with regard to those FBO accounts.

It created a lot of ambiguity as to which banks held which end users' funds and the actual amounts.

So you can imagine if Synapse had had an effective and accurate reconciliation process, it could have saved a lot of people a lot of headache.

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