Square Line of Credit FAQ

A line of credit is flexible, revolving capital that gives your business access to funds when needed. The way it works is that — if approved, you’ll have a specific “credit line”. You’ll have flexible access to the funds and can draw from the line as often as needed up to the available credit line amount. Once you withdraw funds, interest starts to accrue.

For example, if you have $10,000 in credit and withdraw $2,000, you have $8,000 in available credit. A line of credit is revolving credit, so as you pay back that $2,000, your credit line will increase back to $10,000.

A line of credit can be used again and again (as long as you’re within your credit limit). And it doesn’t have to be used on just one thing — you might use it for hiring at one point and then an unforeseen repair the next.

The Line of Credit product is currently in Beta, so it isn’t available to all Square Sellers at this time. To see if you have an offer available, check your Square Dashboard.

Your line of credit is determined by your history with Square and is based on a number of factors, including your Square processing volume. 

No — there are no fees for withdrawing your line of credit. We just charge interest on your outstanding balance.

We’ll charge interest only on what you borrow starting the day you receive funds and until it’s paid back. For information on your interest rate, see your agreement in your line of credit dashboard.

For example, if your APR is 16%, your daily interest rate would be 0.044% (16% divided by 365 Days). If your account has an outstanding principal balance of $10,000 at the end of a day, the interest charges for that day would be $4.38 (0.044% Daily Percentage Rate x $10,000 Outstanding Principal).

Applying is quick and easy, taking just 2 minutes of your time. We’ll verify both your personal information and your business information promptly. If we require more information or documents for your application, we’ll reach out in your Square Dashboard as well as email.

If we aren’t able to verify your business, we may ask for additional documents. You’ll receive a request with specific documents and/or information we need to review your application. Be sure to check your email inbox for any notifications asking you to provide additional information.

Acceptable Documents:

• Your business’s government issued SS-4 (EIN confirmation letter). If you misplaced your SS-4 confirmation letter, you can call the IRS and reach their Business and Specialty Tax Line at 800-829-4933. For additional tips, visit the IRS online.

• If you are a sole proprietor or a single member LLC, you may provide your social security card and/or a government-issued ID (e.g. driver’s license, passport, etc.). Find out your business entity type by taking a look at your business tax returns or talk to your tax advisor.

If we aren’t able to verify your personal information, we may ask for additional documents. You’ll receive a request with specific documents and/or information we need to review your application. Be sure to check your email inbox for any notifications asking you to provide additional information.

Acceptable Documents:

• Your Social Security card

• A government-issued ID (e.g. driver’s license, passport, etc.)

A UCC financing statement is a notice that a lender has a security interest in one or more of your assets. If you are asked to provide additional information about a UCC lien, we will provide you with the date, filing number, and the name of the secured party.

If we are requesting additional information about a UCC lien, you may submit one of the following:

• Payment statements indicating the current status of the underlying loan or obligation

• A letter from the secured party stating that the merchant is current on repayment

• A letter from the lienholder that the loan has been satisfied

• A filed UCC termination statement (UCC-3)

No, applying for a Business Line of Credit won’t impact your credit score either negatively or positively.

It can take 3-5 business days to review your application and provide you with a decision on your application.

If you don’t receive a decision within this timeframe, it may be because we still need additional information from you. Be sure to check email inbox for any notifications asking you to provide additional information.

Repayment

If you have a balance, you’ll be automatically debited on the 1st of every month from your linked bank account. Your monthly minimum payment is 5% of the borrowed amount plus any accrued interest.

You can make additional payments toward your balance anytime through your line of credit dashboard.

It can take up to five business days for your payment to process and post on your account. Once your payment post, you’ll see your credit line replenished by the equivalent amount.

You can manage your account through your line of credit dashboard. Here’s how:

1. Sign into your line of credit dashboard with the email address you use for Square.
2. Confirm a one-time passcode sent to your inbox

Access your dashboard to make payments, withdraw funds, or download your line of credit agreement.

You can withdraw funds through your line of credit dashboard. Here’s how:

1. Sign into your line of credit dashboard with the email address you use for Square.
2. Confirm a one-time passcode sent to your inbox
3. Click on Draw Funds > Enter the amount you want to withdraw and the purpose of the draw
4. Click > Continue
5. Click > Draw Funds

Once the withdrawal is confirmed, we’ll deposit your funds into your linked bank account the next business day.

You’re able to access more funds by paying back your line of credit. Once you pay back any amount, you’ll have access to that amount again.

For example, if you have $10,000 in credit and spend $2,000, you have $8,000 in available credit. A business line of credit is revolving credit, so when you pay back that $2,000, you once again have access to $10,000.