Account Characteristics

Introduction

Internally all accounts share similar characteristics. They are nodes with ledgering capabilities differentiated from one another by distinct permissions and requirements. Because of this commonality, all accounts have the same range of node statuses and are all subject to certain processes (e.g. negative balance reconciliation).

Account (Node) Statuses

Accounts can have the following statuses. Platforms can update an account's status with the Update Node API Call.

Negative Balance Reconciliation

We reconcile negative balances when accounts remain negative with no settled transaction with a created on date within the last 30 days. These reconciliations occur throughout the month, and funds will be debited from the user's other accounts or from your Reserve Account to reconcile the balance.

For example: If a user has a negative balance of -$250 and they pay +$150 toward that negative balance before the 30-day period is up, we will reset the 30-day countdown based on the created on date of that successful transaction. If another 30 days pass and there is no successful activity, we will try to reconcile the remaining negative balance of -$100 from the user's other accounts, and if there are no other accounts or there are insufficient funds, we will reconcile the -$100 from your reserve funds.

We recommend setting up webhooks to monitor your reserve account balance. This will help you automatically fund your reserve when it falls below your required minimum balance.

Additional Notes

• If the amount reconciled is more than $100 (this threshold is set by Synapse), the user will be automatically LOCKED.
• If an account reaches a negative balance of -$300 or lower, the negative balance will be reconciled immediately.
• If an account reaches a negative balance of $-300 or lower, the user may be automatically LOCKED (depending if the balance is reconciled from Platform Reserve or from a user account with sufficient balance).
• Please note that the lock threshold for account owners (both user accounts and platform accounts) with overdrawn CLEARING-US or RESERVE-US nodes will be higher than the standard -$300 threshold for deposit accounts (-$1,000 for CLEARING-US; -$10,000 for RESERVE-US).
• Account lock thresholds are subject to change over time.
• If funds are drawn from the reserve account and you want to reverse the debit, create a reconciliation transaction with the note: bal_sweep_for_negative_balance_recon

Other

Issues with Creating Accounts if KYC has not Been Verified

If an account is created before KYC is verified the account will be created but it won't be able to receive nor send transactions until verification occurs. Platforms often fund accounts after creation, if the KYC has not been verified the transaction will fail and create a negative user experience.

If in doubt, View User w/ Full Dehydrate and look for SEND-AND-RECEIVE permission and that is not a MATCH on sanctions lists. For more info click here.

Account Closure with Balance.

Before closing an account, we strongly recommend to first move the funds out of the account being closed to another internal or external account.

However, if you fail to move the funds prior to account closure, payout of the remaining balance can still occur:

ACH Payout

• If an <<account_ach>> node is linked to the account we will automatically send the remaining balance to that external bank account via ACH.
  • If there are multiple linked accounts we will send the balance to the most recently linked.

Check Payout

• If there are no linked <<account_ach>> nodes and the account balance is greater than $0 we will send a check with the remaining balance to the base doc address we have on file for the user.
• Synapse will charge a standard check issuance fee with each Check Payout.
  • Please note that the fee will be charged to the Platform whenever returning a remaining account balance with this payout method.
  • Please also note that account closures initiated by Synapse's Compliance team or executed by automatic Synapse processes can also trigger Check Payouts with associated check issuance fees.

Returns of Final Balance Payments

• If the ACH or check returns to us (e.g. the account was closed, the address is out-of-date or "undeliverable", etc.), then we will follow up with the user to verify his or her address and send a new check to that address.
  • If the check/ACH returns, the user will need to proactively send their new address (or other information required to solve the issue) to our support team.