Dive Brief:

• San Francisco-based Synctera is partnering with card companies Mastercard and Marqeta to bolster Synctera’s business of paving the way for community banks to let fintechs offer digital services, the companies said in a press release Wednesday. For Mastercard and Marqeta, allowing the fintechs to offer debit card-issuing services to consumers and businesses also expands their client set.
• Synctera manages the fintech partnerships from its back-end platform, taking care of potentially deal-breaking issues like regulatory compliance, day-to-day payments reconciliation, and other operational processes, the company said.
• The startup also announced that Regent Bank, headquartered in Tulsa, Oklahoma, had signed on as its newest bank client and that it had launched a card application interface enabling fintech developers to build debit card capabilities into their products using the Synctera platform.

Dive Insight:

For fintechs to offer certain services in the U.S, they are required to work with a licensed banking partner. Synctera essentially leases the bank’s license enabling fintech firms to offer digital services they couldn’t otherwise provide.

"Through its partnerships with Marqeta and Mastercard, Synctera will provide advanced capabilities for card creation, processing, and management, and will make it easier and faster than ever for FinTechs to create new card programs and for community banks to get into the card issuing game," the release said.

Synctera’s agreement with card giant Mastercard and Marqeta, a debit-card issuing and payment-processing provider, will allow fintechs to more easily create new card programs for customers seeking branded cards.

“These strategic partnerships will not only enhance our fintech as a service offering but will help us bring down barriers to participation in the fintech ecosystem,” for banks and fintechs alike, Synctera CEO and co-founder Peter Hazlehurst said in a company statement.

Regent Bank is a locally owned community bank in Oklahoma which supports local and middle-market businesses. “Partnering with Synctera is a natural next step as we continue to grow and service our customers in key industries like fintech” said Steve Baker, chief operating officer at Regent Bank. 

With the signing of Regent bank this week, Hazlehurst, former head of Uber Money and the one-time project management director at Google Wallet, said the company now has agreements with four financial institutions, also including Coastal Community Bank based in Everett, Washington, Lineage Bank of Franklin, Tennesee, and New York money manager Ellevest. 

By using Synctera’s platform, community banks can more efficiently allow fintech partners to offer customers digital services like mobile banking, debit cards, and other payment innovations. “The banks will earn money whenever a customer swipes their debit card,” Hazlehurst said.

Synctera, founded last December, raised $12.4 million in seed money, and in early June, the company announced it had raised another $33 million in funding led by Fin VC. Mastercard was among the investors. Synctera currently has about 50 employees and aims to triple its workforce by year’s end, the company said in a statement. 

Marqeta, another young company founded in 2010, recently sold stock to the public for the first time, with a Nasdaq Stock Market debut on June 9 that gave it a $16.6 billion market capitalization.

Synctera’ additional fintech partners include Socure, a digital identification verification platform, and CheckAlt, a payment-processing provider for banks.

Synctera’s goal is to be working with 15 community banks and 25 fintechs by the end of 2021, according to the company statement.