Square Loans FAQs
How Square Loans Work
Square Loans provides access to funds to grow your business, with no hidden fees or lengthy applications to fill out. Upon approval, funds are deposited as soon as the next working day – so you can invest in your business immediately to increase inventory, purchase equipment, hire employees and more.
Your loan must be fully repaid within 18 months.
Learn how to download your loan agreement in Navigating your Loan Dashboard.
Yes, you’re required to pay at least 1/18 of your initial loan balance every 60 days to make consistent repayment progress. For most Square Loans sellers, regular processing volume will cover the minimum payment.
Note: if you just make the minimum payment, you will only pay down half your total owed balance of your loan. You will owe the remaining balance upon the maturity date of your loan, and may be debited for that amount.
There are no ongoing interest charges. Instead, you will pay one loan fee to borrow the loan. The loan fee is the difference between the total owed amount and the initial loan amount. The loan fee will never change, regardless of how quickly or slowly the loan is repaid.
Upon approval, funds will be deposited as soon as the next working day.
However, please know that the time that it takes for those funds to be available to you will depend on your bank’s processing speed. It can take them up to three working days to process this deposit.
For more information about your bank’s processing speed, please contact your bank.
You can cancel your loan application while it is still processing, or within two working days of loan origination. For more information, view Cancelling Your Loan Application or Loan.
Once you have applied for an offer, we’re unable to change the loan amount. If you’d like to cancel your loan after it has been funded, you can do so before a decision is made on your application or within two working days of the loan acceptance date listed in your contract. If you cancel your loan, a subsequent offer is not guaranteed.
Repayment
You’ll repay your loan through a fixed percentage of each card transaction processed through Square. Your repayment rate remains the same, and the amount you pay each day is tied directly to your card processing – you’ll pay more when business is strong and less if things slow down. The repayment rate will be applied to your gross card sales, including tips and taxes paid by your customers using a credit or debit card, ACH payments and QR code payments made with the Cash App. Please note that your repayment rate applies in addition to Square’s processing fees for these transactions.
If you haven’t met the minimum by the monthly due date, your linked bank account will be debited to help you stay on track. Also, your full loan balance must be repaid in full within the repayment time specified in your loan agreement.
Information on your monthly minimum and due date is available in the Loans tab of your Square Dashboard.
Here’s an example:
- amount deposited in your bank account: $1,000
- Total Borrowing Cost: $40
- Total loan repayment due: $1,040
- Term: two months
- Percentage of daily card sales that go towards loan repayment: 10%
- Minimum amount due every 1 month for 2 months: $520
Example of daily repayments:
Numbers are for illustrative purposes only.
Example of monthly repayments:
Your loan must be fully repaid by your loan maturity date, which you can view in your loan agreement.
A fixed percentage of your business’s daily card sales will start being deducted two days after your funding date. The specific start date is provided in your funding agreement
You are not able to adjust your repayment rate after you apply for your offer. The repayment rate is tied directly to your loan offer size and is based on a number of factors, including your business’s history with Square, as well as payment-processing volume.
If your daily sales cannot cover the minimum payment, your Square-linked bank account may be debited the remaining minimum payment and your repayment rate may be increased until the minimum payment is met.
Yes, you can submit prepayments any time at no additional cost. The total cost of your loan does not change by making prepayments.
You can prepay your loan through your Square Dashboard in four easy steps. Here’s how:
- visit the Loans tab of your Square Dashboard
- Click on Make a Payment
- Specify a partial payment amount you would like to make, or if you want to pay the current balance in full
- Review and confirm your payment
That’s it. And remember, there are never any additional fees for paying your loan back early.
Please note that if you fully prepay your loan, your business’s loan eligibility will at that point be re-evaluated. We can’t guarantee that you’ll receive a new offer after you make an additional payment or pay off your loan. It can take up to 10 working days for payment confirmation and for your account to be evaluated for new loan offers during which time you won’t have any loan offers visible in your Square Dashboard.
For any other questions or additional help, please contact us.