Abstraction Layer for BaaS Relationships
Peter Hazlehurst and Kris Hansen, co-founders of Synctera, on BaaS in 2023
The real product in BaaS is not just bank access, it is standardizing a messy bank by bank workflow into one repeatable system. Synctera is built around that idea. It gives fintechs one API and one onboarding process, while still preserving a direct legal and operating relationship with the sponsor bank. That matters because every bank has its own risk rules, compliance preferences, pricing, and launch speed, and those differences can break product rollout when handled one bank at a time.
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Synctera’s model is to sit between fintechs and multiple community banks, do the matchmaking, and package compliance, ledgering, KYC, fraud tools, and billing into a common layer. That lets a fintech build once, then choose among bank partners with different risk appetites and timing, instead of rebuilding flows for each bank.
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The tradeoff in BaaS is speed versus control. Lithic describes all in one BaaS as an off the rack setup that gets a program live fast, while larger fintechs eventually want direct dialogue with the sponsor bank for custom KYC, card setup, compliance, and new products. Synctera’s pitch is that it keeps that direct bank relationship instead of fully hiding it.
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This abstraction layer became more strategic as the market matured. Early middleware platforms won by making launch easy in weeks, but later the market shifted toward lower complexity and tighter control. Recent winners like Column bundle charter, ledger, payments, and compliance inside one bank, which is another way of solving the same coordination problem that Synctera originally addressed through software and bank networks.
Going forward, the strongest BaaS products will look less like simple bank connectors and more like operating systems for bank fintech coordination. Some will do it as middleware marketplaces, like Synctera, and some will do it inside a vertically integrated bank, like Column. In both cases, the advantage comes from shrinking custom bank work into a smaller set of standard decisions that can scale.