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What does the app say about where your money is?
A line in an app that says "FDIC insured" is reassuring, and it deserves a follow-up question. Which bank is it, and how does anyone know which part of the money is yours?
Is the money in my fintech app FDIC insured?
Only once the app has placed it at an FDIC-insured bank and the records show you as the owner. 1
That line in the app describes the bank behind it, when the app names one. It says much less about you, because the app is often not the bank, and your coverage depends on the bank, the ownership records and the limit.
What does insurance not cover in an app?
It does not cover the failure of the app itself when the app is a nonbank company. 2
The FDIC says deposit insurance does not protect against the insolvency or bankruptcy of a nonbank company, and that getting money back through a court process may take some time. So there are two separate questions. Would you be covered if the partner bank failed? Possibly. Would you get your money quickly if the app failed? Insurance does not answer that one.
How does pass-through insurance work?
It extends a custodial account's coverage to the customers behind it, if three conditions are met. 1
The funds must truly belong to the customer, the bank records must show the account is held for others, and records kept by the bank, the app or another party must identify each customer and what each one owns. The FDIC puts the recordkeeping point plainly: records must identify who owns the money and the specific amount each person owns. 3
If the conditions are not met, the deposits are treated as belonging to the named account holder and added to its other accounts at that bank, which can leave customers uninsured.
What happened with Synapse?
Synapse was a middleware company that connected apps to partner banks, and the FDIC named its situation as the example behind its custodial-account recordkeeping proposal. 4
An insured bank is only the start. Clean records linking each customer to a balance are what make coverage reach you, and the proposal aims at exactly that. 5 Our Synapse and Evolve explainer tells the story in full, and the hidden risk of two apps sharing one bank covers a related trap.
Is the FDIC custodial-account rule in effect?
As of 2026-09-30 we found it still at the proposal stage, with no final rule published. 6
Rule status checkedThe proposal would require banks that hold custodial accounts with transaction features to keep records of each owner and balance and reconcile them daily. A proposal is not the law, so do not assume your app is already subject to it. We search the Federal Register again before each update of this guide.
What should I check for any app?
Find the bank, confirm it, and ask how your balance is recorded. 7
The FDIC advises identifying the specific FDIC-insured bank or banks where the app says it will deposit your funds and confirming the bank in BankFind. Tick off the steps below as you go.
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How much should I keep in one app?
Keep no more with one bank than the per-bank limit, counting everything else you hold there. 8
The standard limit is $250,000 per depositor, per insured bank, per ownership category, and two apps can quietly route your money to the same partner bank. Use the calculator to add your app balance to your other deposits at the same bank. For the full rules by account type, see our guide to FDIC coverage for families. The FDIC check tool and the fintech safety check on SwitchWize are good starting points, and our longer article on whether a fintech account is insured goes deeper.