Square Loans with Fixed Monthly Payments FAQ

Square loans are business loans with no hidden fees or lengthy applications to fill out. Upon approval, funds are deposited as soon as the next business day – so you can invest in your business immediately to increase inventory, purchase equipment, hire employees, and more. All loans are issued by Square Financial Services, Inc., a Utah-Chartered Industrial Bank, Member FDIC.

To give you the largest possible offer, we consider many aspects of your business, including your processing history with Square as well as your credit score. If we’re unable to pull your credit, you’ll receive an offer solely based on your business’s performance. Regardless, your credit score won’t be impacted and we’ll never use it to deny a loan offer.

When determining loan offers, many factors are considered, including processing history with Square, your payment processing volume and your credit score. If you are eligible for an offer, the offer presented is the largest offer available to you at this time.

There are no ongoing interest charges. Instead, you will pay one fixed loan fee to borrow the loan. The fixed fee is the difference between the total owed amount and the initial loan amount. The fixed fee will never change, regardless of how quickly or slowly the loan is repaid. Additionally, there are no applications, prepayment, or late fees.

You can cancel your loan application while it is still processing, or within two business days of loan origination.

Once you have selected an offer, we’re unable to change the loan amount. If you’d like to cancel your loan after it has been funded, you can do so before a decision is made on your application or within two business days of funding. Please note, if you cancel your loan, a subsequent offer is not guaranteed.

If you apply for a Square loan with fixed monthly payments, to give you the largest possible offer a soft credit pull is required, but it won’t hurt your credit score. If we are unable to pull your credit, you’ll receive an offer solely based on your Square processing activity. Regardless, your credit score will not be impacted, and we will never use it to deny a loan offer.

No, the offer presented is the only offer available to you at this time.

The Employer Identification Number (EIN) is a unique nine digit number assigned to your business by the IRS. We will use your EIN, ITIN, or Tax ID to verify your business in order to process your request for a Square loan. If you operate as a sole proprietor, you will enter your SSN.

You can refer to your government issued SS-4 or your recent business tax returns to locate your legal business name and EIN. Take a look at our Information Requested for Square Loan Application FAQ to learn more.

If you are a sole proprietor, you are able to use your name and Social Security number (SSN) in place of your legal business name and EIN.

A Business Manager is someone who has significant responsibility to control, manage, or direct the business applying for the loan, including but not limited to, a President, Chief Executive Officer, or other senior manager.

If you’re not a Business Manager, you’re required to submit additional identifying information on behalf of the Business Manager, as well as your business role or title.

A Beneficial Owner is someone who directly or indirectly owns 25% or more of the business applying for the loan. For example, Bob’s Donut Shop is owned 50% by Bob and 50% by Tasty Donuts, LLC. Tasty Donuts, LLC is owned 50% by Joe and 50% by Mary, both individuals. So, Joe and Mary indirectly each own 25% of Bob’s Donut Shop and would be listed as Beneficial Owners. Bob directly owns 50% of Bob’s Donut Shop and would be listed as another Beneficial Owner.

If you’re not a Beneficial Owner, you’re required to submit additional identifying information on behalf of the Beneficial Owners. We won’t contact any listed Beneficial Owners or ask them to review your request for a loan.

We’re required by law to collect additional identifying information regarding the control and ownership of businesses that apply for a Square loan.

No, a Business Manager and/or Beneficial Owner doesn’t need to review or sign your application.

If you were declined because your credit report belongs to a different individual that’s not listed on the loan application, it’s likely because the Social Security number provided on your loan application did not match the one on your credit check. The applicant for the credit check and the loan application must be the same individual.

Your business will be reevaluated for a loan offer regularly, and if one is available you’ll be able to reapply on your Square Dashboard.

For Square loans with fixed monthly payments, you’ll make 12 fixed monthly payments from your Square balance until your loan is paid off. If your funds are insufficient, the rest will be debited from your linked bank account.

You can pay back your fixed monthly payment loan early— either partially or in one lump sum. When you make a prepayment, your payment will be pulled from your Square balance. If you have insufficient funds in your Square balance, the remainder will be debited from your Square linked bank account. However, if you have manual deposits enabled, any prepayments will be debited directly from your linked bank account. There are no additional fees for paying any portion of the loan back early.

To submit a prepayment:

1. Visit the Loans tab through your online Square Dashboard.
2. Click Make a Payment.
3. Select the amount or the full outstanding loan balance.
4. Click Continue > Make a Payment.

Important:

• All payments will be considered final, and will not be reversed or refunded.
• If you submit a partial payment, it’ll be applied to your upcoming scheduled payment. If the payment amount is more than your scheduled payment, the rest will be applied to pay down your next month’s scheduled payments.
• The exception is if you have a past due balance in which case, any payment you submit will apply to your past due balance first.

If your Square balance and your linked bank account do not have sufficient funds to cover the monthly payment, we’ll help you pay down the rest automatically with 15% of your daily Square sales. There are no late fees or penalties.

We do not require collateral for loan amounts of $100,000 or less. For loans amounts over $100,000, we may take a security interest in your business assets and file a UCC statement with the Secretary of State where your business is organized. We may also require a personal guarantee for the loan on loans greater than $250,000.

A UCC-1 filing is a publicly available record that provides notice of a security interest in certain property of a debtor. UCC statements are typically filed with the Secretary of State where a business debtor is organized. UCC statements can be filed for several reasons. For example, UCC statements are sometimes filed when a lender makes a secured loan to a business.

After you have finished paying off your loan, you can reach out to us with a request to remove the UCC-1 filing. Please note that we only file UCC-1 statements on loan amounts above $100,000, and that it can take up to 10 business days after repaying your loan for the lien termination to be filed. Once the lien termination is filed, it could also take additional time for the Secretary of State to process the termination and provide a UCC-3 termination statement.

Institutions will sometimes use a third-party to file, track, and maintain lien positions as the registered agent of the institution. Corporation Services Company is a common third-party representative. If you are unsure of what institution the third party is acting on behalf of, the best practice is to reach out directly to the third party.

We may ask for a personal guarantee on your loan for loans greater than $250,000.