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Have you been Declined for a Loan through Square Capital?

We appreciate your interest in Square Capital. If you were recently declined for a loan through Square Capital, the following information may help you better understand the credit review process.

Why was I declined after receiving an offer?

After you apply for a loan through Square Capital, your application goes through underwriting and verification processes to determine whether your business qualifies for the loan you requested. The specific reasons your application was declined can be found in the email notice you received from Square Capital.

We understand being declined for a loan through Square Capital can be disappointing, and we’d like to do our best to increase transparency behind this process.

How can I become eligible?

Square Capital is an invitation-only program for eligible Square merchants. If you received a loan offer in your Square Dashboard, you are eligible to apply for a loan. Please keep in mind that each loan application is subject to credit review, and being eligible to apply for a loan does not guarantee that your application will be approved. You can learn more about eligibility in this Help Center article, Square Capital Loan Eligibility.

What are the reasons for being declined?

There are various requirements that must be met in order to qualify for a loan. Some of the reasons for decline include but are not limited to:

Your business has had unusual payment processing activity recently: When we review your account after you submit your application, we look at your payment history with Square. If you have been declined for this reason, it means that your recent Square account payment history seems unusual.

Your business has taken fewer Square payments recently: If you have been declined due to payment history, we have reviewed your account and determined that your sales through Square have decreased relative to your prior payment history.

Your business has recent chargeback claims from sales through Square: To protect your business from chargebacks, be sure to have receipts or invoices to prove you provided your goods or services. Square Capital may decline your loan application if your business has received too many chargeback claims while using the Square Point of Sale app. To find out more about chargebacks and proper documentation, visit the Town Square Blog: Chargebacks 101.

Your business is connected to another loan through Square Capital: When your business is connected to another loan through Square Capital, it is important to keep the connected account current and processing consistently. If you have one or more accounts that don’t meet this criteria, your new loan application may not be approved.

Your business has had transactions which are considered to be cash advancing: Cash advancing includes swiping your own credit or debit card, or those of family members, friends or associates. This conduct is prohibited by Square’s Terms of Service. Square’s Point of Sale service is designed to process payments for the sale of goods or services. It is not designed to process person-to-person transfers, or to facilitate payments between companies owned by the same individuals/groups of individuals or within companies.

Please note that Cash App is designed to be a peer-to-peer transmission product, and can facilitate the transfer of funds between family and friends. You can find more information about Cash App here:


Your Square account has experienced failed debits: Your Square account is reviewed for failed debits due to insufficient funds. It’s important to the Square Capital program that loans are originated responsibly. We are here to help you grow and succeed. We want to make sure that your business can support the minimum payment requirement for your requested loan. Please be mindful of the amount of funds available in your linked bank account to avoid failed debits.

Is my credit score affected?

No, applying for a loan through Square Capital doesn’t affect your credit score.

Why was I declined for an additional loan?

We review every loan application on a case-by-case basis, independently from any previous loan. Even though your most recent request for a loan through Square Capital has been declined, it does not prevent you from becoming eligible for a loan through Square Capital in the future. We routinely review eligibility of our sellers and if your business becomes eligible to request a loan again, you will see loan offers in your Square Dashboard. Offers are based on a variety of factors including payment processing volume, account history, and payment frequency.

When will I be eligible again?

We are unable to predict when your business will be eligible for another loan. However, depending on your decline reason, we may be able to provide an estimated timeline for when your account may be eligible for reevaluation.

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