Posted by Chuck on July 23, 2019
High-Yield APY Accounts

Published on July 23rd, 2019 | by Chuck

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Beam Banking Terminates Banking Agreement With Evolve Bank, Switches Banks

Beam 2-4% banking sent out an email (Subject: Beam Termination) to customers that they’ve terminated agreements with their banking partner, and thus users need to withdraw all funds within 30 days.

Dear Beam Customers,

Currently, your funds are deposited in a demand deposit account (DDA) opened in your name. Beam has partnered with Synapse, a third-party bank software provider and agent of Evolve Bank & Trust, Member FDIC, to open these accounts.

Unfortunately, as of today, Synapse and Beam have terminated their agreement and Beam will no longer be able to offer banking services through Synapse, including demand deposit accounts with Evolve Bank & Trust, Member FDIC. As a result of the end of Synapse and Beam’s Agreement, we are hereby providing you with 30-days’ notice to withdraw the funds in your Beam account.

In the case you do not withdraw the funds in your account in their entirety in 30-days from today, we will send funds back to your linked bank account or issue you a check to your last address on file, as appropriate. Please be sure to confirm the address on file with Beam is still your current address.

We apologize for any inconvenience this may cause. If you have any questions, please reach out to Synapse at help@synapsefi.com.

Best,
Synapse

The Beam website has not been taken down. I’d guess they’re going to try finding a new partner. So maybe it’s not the end for Beam. In any case, if you started banking with them in this beta stage, you’ll need to withdraw your funds within 30 days.

Will and myself were the top referrers for Beam based on the previous blogpost, and we were thus eligible for an increased 7% rate on some amount of funds for some number of months (I don’t recall the exact details). I was planning to use mine, and Will was planning to give his spot away to a reader. We’ll see if any of that ends up happening.

Update: Beam sent out an email indicating they’ll take care of the transfer; it’s just a switch from one back end to another which Beam will manage on their end.

Hat tip to reader @Cliftonmcdnl



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Cliftonmcdnl

Also worth adding that this comes just days after an email I missed from them on July 17 that stated “Beam will be transitioning all services to our new partnering bank(s), Member FDIC. More details later, but starting from this new release, Beam will no longer be offering banking services through Synapse and Evolve Bank & Trust. Funds in your Beam account will remain fully FDIC-insured with unlimited withdrawals.”

I can forward you the full email if it helps. That one stated that funds would automatically transition to the new bank.

Ryan
Ryan

I too received that email. While it seemed to imply that Beam would automatically transition funds to the new bank, a closer read clarifies that funds will be refunded and we will need to redeposit. Here is the relevant excerpt:

“Regardless, on August 19 (30 days from today), we will automatically refund your entire Beam balance back to your linked external bank account (e.g. Chase Bank) and close your legacy account at Evolve Bank & Trust. If you do not have an account linked, we will issue you a check to your last address on file.

When the new release becomes available, you will be prompted within the app to update or download the new Beam app. You can then login with your existing Beam user credentials and relink your external bank account and fund Beam, which should take under a minute. With the new Beam app, all your prior credited referrals and earned Billies will still be valid, which will allow you to earn a higher rate under the new offering. “

Cliftonmcdnl

Good point. To be honest, I withdrew my entire balance a few weeks ago since I’ve been stuck at the $400 maximum since the beginning with my waitlist position never moving forward. Not to mention how glitchy their app has been lately.

ADP
ADP

This change highlights that when you load money into these sorts of “platform banking-style accounts,” you’re not buying a deposit backed by FDIC/NCUA insurance, you’re buying a security of which the proceeds generated by the platform will be deposited into an FDIC/NCUA-insured account. The difference is that if the platform fails, the buyer of the deposit (re: you) has no super-priority recourse and will instead be treated like an unsecured creditor – last in line (but above equity interests).

I think the average Joe reader will trip up on this nuance to their own detriment.

Frank

I don’t see that at all “your funds are deposited in a demand deposit account (DDA) opened in your name”…”demand deposit accounts with Evolve Bank & Trust, Member FDIC”. Seems like you have a DDA at Evolve, which is covered by the FDIC (per FDIC website). Evolve just partnered with Beam to better market the account

LD
LD

Their blog mentioned a long time ago about raising their starting rate above 2% and it still hasn’t happened so they really are uncompetitive. I have gone back and forth several times maxing out after building a stash of Billies, but the most complicated part was trying to get interest information to include on a tax return. Beware they didn’t send out 1099-INT’s last year and you had to request a spreadsheet directly from Beam with your daily interest activity. Evolve had nothing to provide. Hope their new partner offers a much higher rate.

Alex
Alex

A new response from Beam today. I took out the banks names because they said to do so until it was ready for public release. Dear Beam-Liever, Yesterday’s email from Synapse titled “Beam Termination” had apparently caused some confusions around our community, especially in light of the earlier announcement email that Beam has sent on July 17 titled “Regarding Our New Release”. To promptly clarify, here are some answers to your commonly asked questions, so we can keep our inboxes sane too! What emails? If you haven’t received either of the aforementioned emails, your Beam emails are likely vacationing 🌴 in your spam folder. Be sure to white-list this email yourfriends@meetbeam.com so you can promptly receive future announcements, especially as it relates to Beam’s upcoming new app release. 💵 “Beam Termination”? Rest assured, Beam is certainly NOT “terminating” as the Synapse email title may have incorrectly suggested. What’s “terminating” is that Beam has elected to end the vendor relationship with our service provider Synapse (thank you for your past service Synapse!). Unfortunately, Synapse did not provide Beam the flexibility to modify or consult with us on the content of their email Notice, which raised some amusing and confusing inferences. Though well-intended, it did feel like a poorly worded break-up letter, so we do apologize. 💔 👼 Do I need to withdraw funds? Important question! While you always have the flexibility to withdraw funds anytime (and we would actually prefer that you do so on your own), if you’re too busy to bother, Beam will take care of the account migration and fund transfer automatically on your behalf, so that you do NOT need to do anything. You do, however, need to re-link your external bank account as a funding source when you are prompted to onboard the new Beam app. Who are the new bank(s)? The new participating banks for Beam will be a consortium of publicly-traded banks, namely X., X, X, and X. Notably, these banks are more established as compared to Evolve Bank & Trust, which we would be phasing out along with our relationship with Synapse (thank you Evolve!). Since we won’t be broadly announcing these details until our upcoming public release date, as Beam’s valued supporter, please keep this information to yourself. 🙂 Timing for an automatic balance refund? Please note that since the Notice email from Synapse was not sent out until July 23, if… Read more »

Chris
Chris

So they’ve partnered with a new bank and the ios/android apps are available for testing. The current base rate is 1.7%. If you refer other users the base rate can jump to 2.5% and 3%. There is also a ‘premiere’ level for deposits over 100k, but the rate isn’t specified. Maybe you could start a referral thread for anyone that needs an invite?

007
007

FWIW, looks like the old referral thread is still active:
https://www.doctorofcredit.com/share-beam-referrals-high-interest-account/

007
007

Chuck William Charles FYI, Beam (Banking) is now available to the public in the App Store (conformed) and in the Play Store (per their email reply to me re a support question I had).

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