Summary
Increase, the fintech infrastructure company founded by Stripe's first employee Darragh Buckley, launched Increase Bank by acquiring and rebuilding Twin City Bank of Longview, Washington. The result collapses the three-layer BaaS structure — fintech, middleware, sponsor bank — into a single regulated entity. Increase Bank is now both the technology provider and the FDIC-member institution, eliminating the middleware ledger divergence that caused the Synapse disaster. Clients including Gusto, Ramp, and Stripe can now access payment rails, FDIC deposit accounts, and a real-time reconciling ledger through one entity.
Key Facts
- Increase acquired Twin City Bank (~$75M assets, single branch, Satisfactory CRA rating)
- Renamed institution: Increase Bank — federally regulated, FDIC-member
- Collapses three-layer BaaS into one: no middleware ledger that can diverge
- Direct connection to Federal Reserve since 2020; reconciles in real time
- Payment rails: FedACH, Fedwire, Check 21, RTP, FedNow, Visa
- Clients: Gusto, Ramp, Stripe
- Increase became profitable in 2025, remains self-funded
- Monthly payment volume tripled YoY; processed hundreds of billions annually
- Buckley was Stripe's first employee, spent 6 years building Stripe's bank partnership with Wells Fargo
- Third community bank investment in Washington state
- Column (William Hockey) and Lead Bank took similar charter-acquisition paths
- Now subject to safety-and-soundness exams, capital adequacy, CRA obligations
Why It Matters
Increase Bank represents the most architecturally significant response to the BaaS regulatory crisis triggered by Synapse's 2024 collapse. The core insight: the compliance problem in BaaS is not a process problem that better contracts can fix — it is a structural problem that requires owning the regulated layer, not partnering with it. By eliminating the middleware ledger, Increase removes the specific failure mode that stranded 100,000 consumers. The tradeoff: regulatory constraints that a pure-software BaaS provider does not face. Whether the credibility advantage outweighs the flexibility constraint will define the next phase of BaaS evolution.