Clearing Accounts

CLEARING-US

Introduction

Clearing Accounts () are accounts used to temporarily hold funds for transfer, ideally for no more than 2 to 3 days, between senders and receivers. Clearing Accounts are held in the name of Synapse's bank partners, and keep the Platform outside of the flow of funds. Unlike other accounts, Clearing Accounts are not FDIC insured so it is best practice to hold funds in Clearing Accounts temporarily.

Common Use Cases

  • A Clearing Account is ideal for a Platform not registered as an MSB - MSB - A money services business (MSB) is a legal term used by financial regulators to describe businesses that transmit or convert money. Businesses that transmit money or representatives of money, provide foreign currency exchange, cash checks, or are in the some other way in the flow of funds are usually considered MSBs Please, consult with your attorney if your services fall under this definition. Synapse and its partner banks may require a legal opinion letter from your counsels to attest that your Platform does not need MSB registration or Money Transmitter States Licenses to operate. For more information, please refer to https://www.fincen.gov/money-services-business-definition Last updated July 2019 and that is looking to move funds between senders and receivers.
  • Clearing Accounts are also ideal for mimicking escrow account functionality.

Previous Steps

Clearing Accounts are not issued at the user level, but rather at the Platform level. If included in the Platform spec sheet, they can be issued once on-boarding is complete.

Create Account API Call

Create Clearing Account

Next Steps

What to do next will depend on what you are using the Clearing Account product for. Make sure to check the Payments page or Accounts page if you are going to be using another type of account alongside our clearing account.

KYC Requirements

Because Clearing Accounts are not issued at the user level, but at the platform level, we won't require user KYC for the creation of this account (because that KYC will be collected indirectly from other products). However, as with the rest of our products, we will require some KYC from the Platform (which will vary depending on the use case). Synapse's legal and compliance team will work alongside Platforms to outline the KYC requirements based on their respective use cases and other similar factors.

Sub-Resources

Clearing Account APIs

Legal Disclosures

Please make sure to check our General Legal and our Accounts Legal pages.

Clearing Accounts


CLEARING-US

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