TabaPay to acquire assets of struggling BaaS fintech Synapse
Payment processor TabaPay is to acquire the assets and affiliates of US-based Banking-as-a-Service (BaaS) platform Synapse Financial Technologies.
TabaPay offers Synapse a lifeline with acquisition
The deal, the terms of which have not been disclosed, follows a turbulent year for Synapse in which it filed a Chapter 11 voluntary bankruptcy petition.
Furthermore, the platform laid off over half of its workforce in 2023, namely through restructuring efforts instigated in June which impacted 18% of its workforce, followed by a further 40% cut in October which axed 86 positions.
According to Forbes, the acquisition, subject to the approval of a bankruptcy court, will involve California-based TabaPay acquiring Synapse’s brokerage, lending, credit and debit card issuing platforms, with Sankaet Pathak, CEO and founder of Synapse, due to join the firm as part of the deal.
Commenting on the transaction via a recent blog post, Pathak asserts that TabaPay’s “longstanding profitability, robust balance sheet, and complimentary suite of solutions” will enable the fintech to “double down on our core product”.
Founded in 2014 and headquartered in San Francisco, Synapse’s BaaS solution allows enterprises worldwide to launch card issuance, deposit, lending, payment, credit and investment products via APIs.
Synapse is the most recent BaaS firm to undergo a distressed acquisition. In 2023, fintechs such as Rize and Bond both faced similar circumstances resulting in sales.
Additionally, 2024 has seen notable layoffs at BaaS firms such as Treasury Prime, where a strategic pivot led to the company cutting around half of its roughly 100 employees.
