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There are strict rules that govern how banks operate. As bad as that relationship may have gotten recently, there are some basic legally enforced assurances that I can take for granted in how banks will respond to requests about my money. If Simple is a middleman to this transaction, I no longer have those legal protections.

That doesn't sound very great to me.

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Do you have some concrete examples?

What happens to the deposits if Simple (the company) goes under?

EDIT: Yes, I know they are FDIC-insured. But inside accounts setup by Simple. Are those accounts also in Simple's name, or jointly setup? What could potentially happen then during the lawful unwinding of the company?

That's a good question. When you make a deposit how long does it (if ever) sit in Simples possession before being put int your FDIC insured account? This may not sound like a big deal, but if Simple were to go under this float would go under with them.

Paypal, but from the seller side. A lot of banking regulations would prevent Paypal from holding money at whim, etc.

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