How EduFi is working with Synctera to provide easy access to education savings

‍Meet EduFi: A FinTech startup on a mission to maximize the value and convenience of education savings

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EduFi is bringing long-awaited modernization to the use of tax advantaged education savings accounts, which are known as 529 plans in the United States. 

529 plans are a powerful and increasingly popular way to save for education, with almost 16 million accounts holding $480 billion. Unfortunately, as a way to pay for education, 529s are expensive, inconvenient, and stressful, often requiring more than a dozen steps and usually taking days to weeks for funds to be distributed. Whether it is the complex rules and computations, manual forms, burdensome record keeping or simply the suboptimal withdrawal options, it is much too difficult and onerous for 529 owners to access the money they have saved and nearly impossible to do so in a timely manner. 

Current 529 apps are littered with complaints from plan owners bemoaning the lack of easy withdrawal capability. In short, they do not meet the expectations of today’s consumers, who expect financial transactions to be immediate and convenient.

EduFi seeks to be the first and only FinTech to meet those expectations for parents and college students with 529 plans. EduFi is working to digitize, automate, and support the 529 withdrawal process, and is preparing to launch the EduFi 529|Now Card, a debit card that allows users to connect with any 529 to access and utilize the money they need for everyday purchases and eligible education expenses.

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Challenges

To accomplish their goals, EduFi needed a sponsor bank partner to support bank accounts and debit cards for their end customers. The EduFi team evaluated a number of Banking as a Service platforms that could help them connect to and form a successful, long-term relationship with a sponsor bank partner.

But like many FinTechs, EduFi’s journey to find a compatible sponsor bank partner was slow and difficult.

“Most other BaaS providers cared only if we had raised an investment round and were simply looking to plug us into their ‘system.’ They had no real interest in our business or vision.” said Schyler Thiessen, Co-Founder and CEO of EduFi.

That’s when Synctera stepped in.

“Synctera was different from the start as our initial meetings were completely about the EduFi product and our vision for the company. Moreover, they happily answered all of our questions and clearly addressed our concerns while being open and transparent. They quickly followed up with fair prices, great advice, and next steps.”

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“Synctera is a unique Banking as a Service platform that is looking to do well by doing good for FinTechs like us.” - Schyler Thiessen, EduFi Co-Founder and CEO

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Solution delivered

Synctera connected EduFi with a number of potential sponsor banks who were interested in partnering with EduFi. After talking with each sponsor bank, EduFi chose the sponsor bank it believed was most aligned with their vision and could provide the best support.

 “They helped guide us to select the sponsor bank partner that was best suited for us and that would help maximize our success, not just the success of Synctera,” said Thiessen.

Next, EduFi moved on to the Implementation & Onboarding (I&O) process. Synctera’s I&O team helped EduFi integrate with Synctera’s APIs and complete all the other risk, compliance, operational, and testing steps required for launch. The Synctera I&O team helped keep EduFi on track, while Synctera’s Risk & Compliance team provided templates, resources, and expert guidance.

“The Synctera Implementation & Onboarding team is the most amazing and complete team that I have had the pleasure of interacting with in the last 10+ years,” said Jo Halsey, co-founder and CTO. “They’re dedicated technology professionals who I feel truly want us to succeed and show that with their actions not just their words.”

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Results

Within three months of first contact, Synctera enabled EduFi to find a sponsor bank partner, set up its API integration, and test its debit card product with real money and a real bank. For industry context, establishing card programs can take as long as 18 months. EduFi is now primed to bring much-needed simplicity and convenience to millions of 529 owners and beneficiaries in the United States.

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Looking ahead

Improving the 529 withdrawal process is just the first step in EduFi’s larger goal of ushering in a complete paradigm shift in financial services for major life experiences - away from the current product-based approach and towards personalized user experiences and unique, customized services. For now though, by working with Synctera, EduFi is well on its way to maximizing the value of what is often the single largest investment of time and money in a person’s life: higher education.

Join the waitlist for the 529|Now Card at join.edufi.co, or learn more about their company at edufi.co

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