Need to Know
- A hidden code in a recent update to Square’s app for iOS references both savings and checking accounts, though Square has not yet made an official announcement regarding the launch of either.
- The code indicates that the checking account will integrate with Square’s debit card for businesses and that Square will have no monthly service charges or fees tied to minimum balances and overdrafts.
- Square launched Square Financial Services in March of this year, after being granted approval to operate banking services in March 2020.
Square looks to be planning the launch of checking and savings accounts.
While Square has not officially launched the accounts, eagle-eyed iOS developer Steve Moser spotted a code in a recent update to Square’s iOS apps for iPhone and iPad that hints that they are upcoming. The new, hidden code names the new offerings as Square Checking and Square Savings, and indicates that the checking account will integrate with Square’s existing debit card for business. The code also hints that Square will have no monthly service charges, and no fees tied to minimum balances or overdrafts.
In addition, the hidden code suggests that Square will offer a 0.5% interest rate for its savings account through 2021. Funds from sales processed through Square will be available in the checking account immediately.
In a statement about the accounts, Square noted that its banking product, Square Financial Services — which was granted FDIC approval in March 2020 — began operating in March of this year and that the company has “long said its purpose will be to offer business loan and deposit products.”
The new tools will allow Square to compete not only with more traditional banks but also with fellow fintechs such as payments giant PayPal, which has itself recently expanded into banking services. Earlier this month, PayPal announced it would introduce savings accounts, stock-investing, and check-cashing services later this year,
Square has long hinted at its expansion into financial services, most recently testing a loan feature in August 2020 that allowed users to borrow up to $200 via the peer-to-peer money transfer service Cash App, which Square owns. During that pilot, 1,000 users were given the opportunity to borrow as little as $20 and were able to pay back the loan within four weeks at a flat interest rate of 5%. Late payments after the four-week period received a one-week grace period, followed by 1.25% interest each week until the loan was paid off. The company also introduced DIY tax-filing, also through Cash App, in November of last year.