Running a small business can be a daunting task, especially because business owners may not have the luxury of hiring an entire staff, including a bookkeeper. That coupled with keeping up with the different financial transactions can add to the hassle of running a business. However, Square Business Banking promises a solution to all these problems. So let’s take a closer look at the Square advantage.
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- Immediate access to square sales
- Zero monthly fees
- Quick sign up
- Intuitive interface
- High-interest rates
- Flexible repayment terms on loans
- Only Square sellers can open an account
- All loans must be repaid within 18 months
- ATM withdrawal limitations of $250 per transaction
- Limitations of $10000 spending in a single transaction
- No ATM networks
What is Square Business Banking?
Square was founded in 2009 with the sole aim of helping large and small businesses alike streamline their financial transactions by helping collect and keep track of their finances. Moreover, Square entered the world of peer-to-peer payment solutions by launching CashApp, which has realized tremendous success over the years and continues to be improved to provide more functionalities.
In recent years, Square has expanded to other areas, particularly in providing a wide range of business solutions to organizations. The revolution started in 2019 when they offered a debit card, and since then, they have offered several banking solutions, including a checking account, savings account, and financing for small businesses.
Square Banking features
Checking connected to your Square sales
This especially comes in handy if you’re already using Square to collect and keep track of your financial transactions. The funds are automatically deposited into your checking account, and you can either spend or withdraw using your debit card. The transaction reflects immediately, and you will be able to view them through your Square Checking account.
Moreover, the square checking account doesn’t have a minimum deposit or balance requirements. Customers who hold a checking account are furnished with a routing number that they can use to settle bills or withdraw at an ATM. It’s important to note that Square’s debit card does not yield any rewards.
Yields with a competitive yield
Square savings is designed to make your funds as a business owner works for you. Keeping your cash in a high-yielding savings account instead of a checking account with limited rewards is the best option. The APY is 0.50%, a worthwhile reward for any business owner.
Moreover, Square also allows you to set up automatic business savings and takes care of the rest by setting aside a percentage of your sales which goes into savings. You can view your savings goal on your Square account and decide if you’d want to continue saving or pause the automatic business saving.
Loans with flexible repayment
Square’s banking solutions do not end with debit and checking accounts. They also offer loans with flexible repayment plans. How much you receive is based on your eligibility. You can qualify for loans ranging from $300 to 250000.
Square charges a flat fee of 10%to 16% and there is no recurring interest rate. Moreover, you’ll know immediately your loan is approved. Loan repayment happens automatically by deductions on your daily card sales, which equates to 9%-13%. However, Square requires you to make the agreed minimum every 60 days.
It’s important to note that Square loans are short-term, and you will therefore be required to pay in full within 18 months.
Other Square offerings
Square has continued to evolve in its offerings, especially after the release of its mobile app and Square card reader for business and personal use. Here are other features that Square offers:
- Square Register: A point of sale device which allows business owners to process payments from vendors. The device costs $999 as a one-time payment or a $49 monthly payment for 24 months and has lower transaction fees. Business owners can also opt for the Square Stand which acts as an iPad mount and card reader at the same time.
- Square Online Store: A solution that enables business owners to sell their products online. It offers an intuitive and easy-to-use interface and is easy to set up. It will set you back 2.9% to set up and an additional $0.30 per transaction once everything is up and running. It also has no monthly fees.
- Square for Retail: A solution tailor-made for retailers of all sizes with support for bar code scanning, advanced reporting, and online order processing. A point of sale solution designed for brick and mortar companies. It’s similar to Square Register but offers an improved checkout process and additional functionalities such as enhanced inventory management, employee accounts, a list of vendors, and more.
- Square Cash: A service that allows Square customers to send money via email or smartphone without incurring any transaction fees. This offering isn’t specifically targeted at business owners, but they can still use it to make transactions out of a business setting.
- Square Capital: An overdraft service that allows Square users to receive a lump sum, upfront cash amount which they can then repay later. It’s easily accessible through the dashboard in the Square register.
- Square for Restaurants: Suitable for all sizes with in-built support for menu, kitchen and table management, and online order processing.
- Square Appointments: Appealing to businesses in the service industry that require a website with automatic reminders and several payment options such as pre-payment.
Square differs from its competitors because its credit card only has a processing fee for each transaction. It does not also charge monthly minimum processing fees and additional fees. Square has different pricing for its various offerings. Let’s look at some of them below.
Square Reader and Square Stand fees
Purchasing a chip card will set you back $49. All merchants using the Square stand and square reader are charged a flat rate of 2.60%, an additional $0.10 for swiped transactions and 3.5%, and an additional $0.15 for keyed-in transactions. Square charges different fees for merchants in other industries such as restaurants.
Previously, Square charged a $275 monthly flat rate and 0% for swiped transactions up to $250000 per year, but the plan ended in 2014.
Square Register costs and fees
Square offers a revamped register from 2017 which attracts lower transaction fees of 2.5% plus an additional $0.10. The square register costs $799 as a one-off payment or $39 per month for 24 months. However, it’s important to note that you should only purchase the register if you process many transactions because you may end up taking a long time before you get a return on your investment.
Square Terminal costs and fees
Merchants can purchase the Square terminal at $399 or 12 monthly installments of $37 each. The transaction fees are 2.6% plus an additional $0.10 for swiped transactions, while keyed-in transactions attract 3.5% plus an additional $0.15.
Virtual terminal and payment gateway processing
Transactions are charged a flat rate of 2.90% plus an additional $.30
Square offers customer service via three platforms: social media, its support forum, and email. Unfortunately, this may cause disruptions for business owners, especially if they have a matter that needs to be addressed immediately.
Square also offers mobile phone support from 6 a.m. to 6 p.m. PDT. However, they must receive a code through the website to be directed to a customer representative. Moreover, only merchants with an active account are served. No matter the chosen contact method, most customers have reported waiting times of days.
No. Square provides businesses with transaction processing services. Its checking account is provided by Sutton bank.
It may take up to 4 business days to verify your new account. You can check the status of your account via the Square dashboard.
Yes. You can use your Square checking account to cash your check.
No. Square endeavors to provide affordable banking solutions and does not, therefore, charge overdraft fees, monthly fees, fees on foreign transactions, or minimum operating balances.
Square banking solutions are only available for merchants with a Square account. If you’re a freelancer or need an account that allows many transactions, you’re better off looking elsewhere.
If you’re an existing Square customer, you can open a checking account in minutes. There aren’t many limitations to opening an account such as providing your credit history or banking history.
Yes. Square is not a bank but has partnered with financial institutions such as Sutton bank. So you can rest assured that your money is insured for up to $250,000.
Square provides several ways to contact customer service, including email, social media, forums, and phone calls. However, your Square account must be active to receive a text message to contact customer care via phone.
Yes. Especially if you’re already using Square as a business owner, it offers a wide range of benefits. It will help you concentrate on running your business without having to worry about managing your financial transactions.
However, if you don’t use Square to process payments, you should consider looking elsewhere for your banking solutions.