Square Appears to be Preparing to Offer Checking and Savings Accounts
Square Inc., the company that made a name for itself with a new method for small businesses to accept credit card payments, now appears to be privately preparing to offer checking and savings accounts to its customers, according to details recently discovered in the code of an update to its iPhone and iPad app. The code suggests that Square will forgo monthly service charges and fees attached to minimum balances and overdrafts.
Square Financial Services was recently approved for a bank charter, which “began operations in March,” the company said in a statement according to Bloomberg News. “We’ve long said its purpose will be to offer business loan and deposit products.”
Until recently, the company has focused on small-business loans. Though the new business has not been announced, the code revealed that its accounts will be called “Square Checking” and “Square Savings.” The code also suggests that Square will offer a 0.5 percent interest rate for savings accounts through 2021, and any funds processed through Square will be available in customers’ checking accounts immediately.
In 2019, JPMorgan Chief Executive Officer Jamie Dimon said that the bank should have been offering the types of products that Square is releasing. “What does the small business want? They wanted to process cash and checks and debit on the same machine,” he said. “We didn’t give them that opportunity. Square did.”
Square previously shook up the financial world when it debuted its card readers and offered to process payments at an easily understood price. Large, traditional banks typically provide long lists of rates to customers accepting credit and debit cards. These banks have vocalized disdain for fintech companies that are allowed to compete with banks without the same levels of regulatory oversight.
Though the release date for Square’s checking and savings products are unclear, their presence in the app code could signal a release in the near future. The code also has links to web pages that advertise products on Square’s website that are not live yet.