Launch of Square Loans Offers Quick, Simple Access to Funds for Canadian Businesses

Apr 28, 2022

Désirée Kretschmar, Plant Goals

Today, Square announced the launch of Square Loans in Canada, giving small businesses quick and simple access to funds and eliminating another major pain point associated with running a business.

By using transaction data, Square Loans proactively surfaces customized offers to eligible sellers, providing them with a straightforward application process, where no paperwork is needed, and delivering funds as soon as the next business day. Businesses have one clear, upfront loan fee, which is automatically paid back as a set percentage of daily card sales with Square — so sellers pay back more when sales are strong and less during slower times. The loan fee never increases for the seller, so the amount they owe is always clear.

Désirée Kretschmar, the owner of Plant Goals, a thriving plant store located in Peterborough, Ontario, said that Square Loans offers easy-to-access funding that is helping her grow her business. “Our store was only 85 square feet, I could reach my hands out and touch both walls. We grew super quick in those first few months and signed a lease to move to a bigger spot; the next day, the pandemic hit but we’ve been running head first ever since — offering in-person, online sales and deliveries,” said Désirée, who has since accessed Square Loans to purchase more plants and accessories to keep pace with strong demand from customers looking to green-up their homes.

“Square Loans is so easy. Everything is laid out and it’s presented in an approachable way, as opposed to… the rigamarole another financial institution might put you through,” explained Désirée, who says she also faced skepticism when she visited a traditional financial institution in town, before opting for Square Loans.

92% of Canadian business owners who received traditional loans find the process intimidating

A newly released survey commissioned by Square shows that roughly 7-in-10 Canadian small business owners have never accessed traditional funding, preferring to “bootstrap it alone.” According to the survey, 46% admitted they’ve been forced to rely on personal credit cards; while one-in-five have accessed loans from friends and family to keep their business going in the past.

Although small and medium-sized businesses are often lauded as the backbone of Canada’s economy, creating up to 60% of the nation’s jobs, access to affordable funding is an unmet need that Square Loans was built to solve. The survey revealed that 92% of business owners who had received traditional business funding found the process “intimidating” while 84% said traditional business loans were overly “complicated.” Overall, 72% reported they were not happy with the repayment process for traditional loans.

83% of small business owners say the pandemic has made access to business loans more critical

One-third of Canada’s small business owners reported that running their business throughout the pandemic has been “a challenge” but they are “proud to have made it through so far.” More than eight-in-ten entrepreneurs (83%) surveyed said that the pandemic has made access to business loans more critical now than ever before while 51% said that the current business climate was a key concern when considering traditional loan repayments.

“It’s no secret that small and medium-sized businesses face tremendous barriers when it comes to accessing funds to help them transition and grow. As the pandemic eases and Canadian business owners look to the future, they need help moving forward now more than ever before,” said Luke Voiles, GM Business Banking at Square.

“From our earliest days, Square has focused on building easy-to-use tools and services to empower entrepreneurs to succeed on their own terms,” said Alyssa Henry, Head of Square, adding that 48% of surveyed entrepreneurs say they feel positively about being eligible for an easy, as early as next-day access to a business loan with flexible repayments. Almost one third of respondents (29%) believe it would help them feel less stressed as they move forward and look to grow their business long after the pandemic.

Since the initial launch of Square Loans in the US and Australia, Square has provided more than USD$9 billion in financing to more than 460,000 businesses, with an average loan size of USD$6,750. In Canada, business owners can learn more and apply for Square Loans by visiting square.ca/loans.