Square's Loan Services: What You Need To Know

Square offers small business loans with no long forms to fill out and automatic repayment. Square Loan applicants can receive between $100 and $350,000 in loans, depending on their business performance. The company offers customised loan options based on a variety of factors, including the time spent using Square, processing volume, and customer mix. Square Loans are merchant cash advances, so they are unrelated to the applicant's credit score.

Square Loans are business loans designed to help grow your business

Square Loans are business loans designed to help you grow your business. They are merchant cash advances that are not related to your credit score. Square does not run credit checks, and accepting a loan will not impact your credit rating. Square Loans are only available to Square sellers, and eligibility is determined by factors such as processing volume, account history, payment frequency, and customer mix. Loan amounts range from $100 to $350,000, and funds are deposited as soon as the next business day.

Square Loan offers are personally tailored and customized for each business. The loan agreement can be accessed through the Square Dashboard, and there are no hidden fees or lengthy applications. Square Loans charge a set fee, which is a percentage of the loan amount, and repayment is made through daily deductions from card sales. The percentage deducted is fixed, but the amount adjusts to match the business's cash flow. There is no interest charged, so the balance remains the same regardless of how quickly or slowly the loan is repaid.

Square Loans offer flexibility, with no collateral required for loans up to $100,000. For loans exceeding this amount, Square may take a security interest in the business's assets and may require a personal guarantee. Repayment terms are also flexible, with no penalty for pre-payment. However, it is important to note that pre-paying may increase the effective APR. Square Loans provide a convenient and straightforward option for businesses seeking alternative financing solutions.

Square Loans offer a unique opportunity for businesses to access funding and support their growth. With no impact on credit ratings, tailored loan offers, and flexible repayment options, Square Loans present a viable alternative to traditional loans. By aligning repayments with the business's cash flow, Square Loans ensure that businesses can manage their finances effectively while investing in their growth. This makes Square Loans a powerful tool for businesses seeking to expand and succeed in their endeavours.

Square Loans are merchant cash advances, not traditional loans

Square Loans are not actually loans at all. They are merchant cash advances. Because a Square Loan is a merchant cash advance, it is completely unrelated to your credit. Square doesn’t run credit checks when it offers you a loan, and accepting it will have no impact on your credit rating. This is a huge plus for people with a history of credit challenges. It is slightly tricky to evaluate Square Loans relative to traditional loans. Square Loans are exclusive to Square customers. There is no process to apply for a loan or appeal loan decisions.

Unlike traditional term loans, which charge interest on the loan amount, Square Capital charges a set fee whether you pay off your loan in one day, one year, or the maximum term of 18 months. Square Capital doesn’t publish its fee rates, but they reportedly range from 10% to 16% of the loan amount. If you spread the fees across the full 18 months, Square Loan fees equate to approximately a 6.7% to 10.7% APR, which is slightly higher than your typical interest rate for a small business loan.

The repayment structure for Square business loans is the same as a merchant cash advance. But instead of deducting payments as a fixed percentage of daily debit and credit card sales, payments are only deducted from your daily debit and credit card sales processed through Square. Square loans allow for flexible repayments based on a percentage of daily credit card sales. Instead of a traditional interest rate or APR, Square charges a one-time, flat fee called a factor rate.

Square Loans are only available to Square sellers

Square Loans are a form of business loan designed to help businesses grow. They are only available to Square sellers and are not traditional loans. Instead, they are merchant cash advances, which means they are unrelated to the borrower's credit score. Square does not run credit checks and does not require collateral for loans of $100,000 or less. This makes Square Loans a good option for businesses that may struggle to obtain credit through traditional avenues.

Square Loans are tailored to each business and are based on a variety of factors, including payment processing volume, account history, and payment frequency. The loan amount offered ranges from $100 to $350,000. Once a loan is approved, funds are deposited as soon as the next business day. Repayments are then made automatically through daily Square sales, with a fixed percentage of daily card sales deducted until the loan is repaid. The percentage taken stays the same, but the amount adjusts to match the borrower's cash flow.

Square Loans have a fixed fee system, with no interest charged. This means borrowers pay a flat fee based on the amount they borrow. This fee is typically reported to range from 10% to 16% of the loan amount, which can make it difficult to evaluate Square Loans relative to traditional loans. While there is no benefit or penalty for pre-payment, making only the minimum payment will result in a higher fee.

Square Loans are only available to eligible Square sellers, and eligibility is determined by Square. Square automatically reviews accounts daily to assess eligibility based on factors such as payment processing volume, account history, and payment frequency. Eligible sellers will receive a loan offer through their Square Dashboard and via email.

Square Loans do not require collateral or a personal guarantee

Square Loans are business loans designed to help you grow your business. They are issued by Square Financial Services, Inc., a Utah-Chartered Industrial Bank, Member FDIC. Square Loans do not require collateral or a personal guarantee for loan amounts of $100,000 or less. This means that Square won't come after your personal assets if you default on the loan, and there is no impact on your credit score.

For loan amounts over $100,000, Square may take a security interest in your business assets and file a Uniform Commercial Code (UCC) statement with the Secretary of State in your business's jurisdiction. A UCC statement is a publicly available record that provides notice of a security interest in certain property of a debtor. It establishes a legal claim or lien on specific business assets. Square may also require a personal guarantee for loans greater than $250,000.

Square Loans are not traditional loans; they are merchant cash advances. They are offered to eligible Square sellers and are personally tailored and customized based on factors such as payment processing volume, account history, and payment frequency. The loan offers range from $100 to $350,000, and upon approval, funds are deposited as soon as the next business day.

Square Loans charge a set fee, which is a percentage of the loan amount, rather than interest. This fee can range from 10% to 16% of the loan amount. There are no hidden fees, lengthy applications, late fees, or additional charges beyond the initial flat fee. You can make prepayments without any penalty, and repayments are automatically deducted from a predetermined share of your credit card receipts each month.

Square Loans are repaid through a fixed fee system

Square Loans are business loans designed to help you grow your business. They are only available to Square sellers, and eligibility is determined by a variety of factors, including the time the business has been using Square, its processing volume and frequency, customer mix, and more.

Square Loans are repaid through a fixed-fee system. This means that instead of charging interest on the loan amount, Square Capital charges a set fee that remains the same regardless of how quickly or slowly the loan is repaid. This fee typically ranges from 10% to 16% of the loan amount, and it is important to note that Square does not publish its fee rates. The repayment rate is directly tied to the loan offer size and is based on factors such as the business's history with Square and payment processing volume.

Repayments are made automatically through daily Square sales, with a minimum of 1/18 of the initial balance repaid every 60 days. The percentage you pay stays the same, but the amount adjusts to match your cash flow. This means that if your sales are higher on a particular day, you will pay more towards the loan, and if you have a slower day, you will pay less. This system ensures that repayments are aligned with your cash flow, providing flexibility and convenience.

Square Loans do not require collateral for loan amounts of $100,000 or less, and they do not impact your credit score. The application process is straightforward, and upon approval, funds are deposited as soon as the next business day.

Frequently asked questions