Don't Lose Access to Your Cash: Comparing Banks, Neobanks, and Fintech Platforms for Cash Savings
Money For the Rest of Us
J. David Stein
4.3 • 1.3K Ratings
🗓️ 19 June 2024
⏱️ 28 minutes
🧾️ Download transcript
Summary
Millions of fintech app users have lost access to their cash. In this episode, we explain why this happened and show you how to protect yourself when placing cash with traditional banks, neobanks, and fintech platforms.
Topics covered include:
- The mass chaos in the fintech space spawned by the bankruptcy of Synapse Financial Technologies
- What are FBO accounts, and why they are so troublesome
- What is the difference between a traditional bank, a neo bank, and a non-bank
- What to look for and protect yourself when investing your cash savings
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Show Notes
Fintech platform Synapse raises $33M to build ‘the AWS of banking’ by TechCrunch—Synapse
Related Episodes
424: Are More Bank Runs Coming? The Collapse of Silicon Valley Bank
412: Where to Invest Your Cash Savings for Higher Yields
304: A 15% Guaranteed Return? Lending on the Fringes of Finance
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Transcript
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| 0:00.0 | Welcome to Money for the rest of us. This is a personal finance show on money, how it works, how to invest it, and how to live without worrying about it. |
| 0:10.0 | I'm your host David Stein. Today is episode 483. It's titled Smart Cash Management, |
| 0:16.4 | Navigating Banks, Neo Banks, and FinTech platforms. |
| 0:20.9 | A week ago, I received an email from the crowdfunding platform Yield Street. The title of the email was |
| 0:28.1 | update on progress to return wallet funds. I was surprised about this email. I haven't invested with Yield Street since 2018. |
| 0:37.0 | I didn't think I had any money there, so I signed into my account and apparently I have two cents in a Yield Street wallet. |
| 0:45.7 | The email said giving you access to your wallet deposits is our top priority. |
| 0:51.0 | We are working with the banks to return them to you directly as quickly as possible. |
| 0:56.0 | That's a little disconcerting if you get that email from a provider and say you can't get access to your funds. Now in my case was two cents, |
| 1:05.6 | but apparently it just wasn't Yield Street. There were other FinTech platforms |
| 1:10.6 | that users were unable to access their cash. |
| 1:15.0 | Here's a Yada user. |
| 1:17.0 | Yada is a savings app. |
| 1:18.0 | User wrote, I have over $60,000 tied up in my account |
| 1:22.0 | with absolutely no access to it. |
| 1:24.3 | If I'm not able to get my hands on my money, then I'm going to start having huge issues next month |
| 1:28.9 | when my mortgage property tax and bills begin to pile up. |
| 1:32.2 | Another app is Juno. That user says I have nearly |
| 1:35.5 | 40,000 dollars tied up in this which includes my emergency funds, savings from my |
| 1:40.9 | house and car and one of my children's savings. |
| 1:43.6 | The funds were there due to an accident on my part. |
| 1:46.2 | They were supposed to be in Treasury bills, but I forgot to reinvest and they were paid out. |
... |
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