Tabapay Drops Plan To Purchase Assets Of Bankrupt Synapse
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Money-moving fintech TabaPay has withdrawn from a deal to purchase the assets of bankrupt Banking-as-a-Service platform Synapse.
A spokesperson from TabaPay has informed the press that the company has sent a “termination notice of the deal to buy the assets due to failure to meet the purchase agreement closing conditions”.
Tabapay Aims To Strengthen Its Position And Potentially Enhance Its Services
TabaPay decided to purchase Synapse’s assets in April, months after the BaaS outfit had to lay off 40% of its employees due to losing a major client. At that time, Synapse mentioned that “the current macroeconomic conditions” had started to influence its clients and platforms, impacting its expected growth.
The Chief Executive Officer of Synapse, Sankaet Pathak, stated that he thinks TabaPay still wants to complete the acquisition. However, the deal collapsed because banking partner Evolve Bank & Trust did not meet their closing condition.
Evolve stated that it was not involved in the Tabapay (sic) acquisition, and did not have closing conditions to fulfill. However, Evolve did have a settlement agreement with Synapse that had a funding condition.
In a previous action by TabaPay, the firm revealed an extended joint venture with Pathward in October 2023. Both firms stated that their partnership would improve Pathward’s range of faster payment solutions.
Tabapay And Pathward’s Joint Effort Is To Provide Faster Payment Solutions To Platforms
In that joint effort, Pathward and TabaPay intend to empower platforms, merchants, and FinTech companies, with faster payments nationwide, meeting users’ expectations. The collaborative effort expands on their initial alliance established in 2020. By linking to the TabaPay platform, Pathward plans to give its partners improved money movement capabilities, providing a more comprehensive end-to-end solution through its BaaS offering.
On April 22, TechCrunch stated that Synapse had filed for Chapter 11 bankruptcy and that its assets would be bought by TabaPay. The purchase price of $9.7 million was considerably less than the over $50 million in venture capital. This acquisition was received by Synapse from investors like Core Innovation Capital, Andreessen, and Trinity Ventures over time.
Established in 2017, TabaPay, located in Mountain View, is an instant money movement platform that SoftBank supported in a 2022 funding round. The amount of venture capital it has raised is unclear.
TabaPay is the major instant money movement platform, which allows lower-cost instant, reliable, and secure payments for Fintech innovators. The firm provides direct access to innovative products, multiple geographies, 14 networks (debit, credit, RTP & ACH), 15 banking partners, and features in one unified API.
