From being a payment processor, San Fransisco based Square has evolved into a company offering multiple in-house services to small businesses. The latest service being offered by them is Square bank account, making it a full-fledged Neobank. Small businesses can now get checking accounts, savings accounts, debit cards and loans facilities along with a payment processing facility under one roof. With this, let’s get to know the benefits of this newly launched facility.
No more transfers required
With access to a full-fledged Square bank account, business owners can easily spend the money they received through Square payments. Earlier, they had to transfer the fund into a separate bank account. So, with the new checking account, the business gets instant access to credit card sales made via Square. This fund can be immediately used via Square debit card, make payments of employees with Square payroll or make ACH transfers.
Square has expanded beyond the debit card facility by offering to save and checking accounts to small businesses. Square bank account comes with no minimum balance requirement, monthly fees, overdraft/recurring fees, or credit checks.
Maintenance fees traditionally cost between 8$ to 12$ in a month. At Square bank account, there is no such requirement. Their saving account offers an annual 0.5% yield on deposits. It makes it a cheaper alternative to traditional business bank accounts.
There is no limit on the number of transactions per month. In traditional banks, these fees can range up to 75¢ for every excess transaction. This way, you don’t have to limit your number of transactions and you have the freedom to operate.
Easy to use
Since all Square bank accounts work like traditional checking accounts, you will surely get routing and account numbers, enabling you to receive and send funds directly from the account. Square provides these banks in collaboration with Sutton Bank. Therefore, your funds are insured by Federal Deposit Insurance Corporation.
Customization and control
Under Square bank accounts, you can open a savings account as well. Square manages your payment products, and so, you can choose the percentage of sales revenue you wish to save every day. It will automatically keep the fund aside and you don’t have to work over it every day until you decide to change the settings. Users are also given control to make folders for different needs such as new assets, taxes etc.
With so many benefits, Square bank accounts are also ideal for all those small businesses that were operating with personal bank accounts rather than business accounts. The biggest worry of these enterprises was high maintenance fees, minimum balance requirements and transaction limits that would hamper their profits and discourage them from formalization. Along with a Square bank account for checking and saving, Square has also advanced to provide loans that are based on a business’s sales history rather than credit score. In future, Square will surely integrate all these facilities, making a conducive ecosystem for businesses.