Is SBA replacing the Square Loans?

[RadioMcG]

We haven't received another loan offer - which I find odd because we are 100% paid off on the last one and typically see an additional offer at 80% or so.  All numbers are significantly up as well. Has anyone else noticed no offer? Or am I just stuck in unknown algorithm for now?

[Regina_B · Accepted solution]

👋👋Hey @RadioMcG and @ecantiques5

Thank you both for your posts. Regina from the Square Loans Team here. Given the current economic challenges facing many small businesses, we’ve had to reduce our Square Loans loan offers to uphold our mission of responsible lending. To help our sellers through this time, we are working with sellers who need payment relief on existing Square Loans loans outstanding. 

Though we may not be able to extend a loan offer through Square Loans right now, teams across Square are unveiling new ways to support businesses’ need for cash flow, and our team is extremely focused on bringing the SBA’s Paycheck Protection Program to our sellers. We also have a dedicated team researching new resources and are updating this list weekly. Here’s the link: Square Loans COVID-19 Business Financing Resources Support Center article. 

For more information about PPP, please take a look at our FAQ. Thanks again and take good care. 

[RadioMcG · Accepted solution]

HERE IS A COPY AND PASTE from a response posted today in the Square Loans section. Passing on the info I read, if you haven't seen it!

To the Square Community,

As we relaunch business loans, we’d like to explain why loan offers were unfortunately paused at the beginning of COVID-19.

First and foremost, we should have been more open with you about pausing business loans, and why it was necessary. We understand the timing was tough for many. We don’t like disappointing, and we know we did. We want to be more open with you about our business, and the lending industry as a whole, so you might understand why loan offers were paused.

Like many businesses, we were unprepared for a full-industry shutdown at the onset of COVID. Pausing loans until we could update our product to better measure the impact of government shutdowns on small businesses, as well as on our own, was the responsible decision.

Our ability to offer access to loans relies on backing from financial partners. When the COVID crisis began to unfold, it became clear that lending in that moment could possibly be irresponsible—for us and our partners, but also for the businesses receiving loans. While it’s true pausing loans was a business decision, we also never want to put any business in a potentially risky financial position. Our mission to better serve small businesses during times like these has further pushed us to start our own bank, which will debut in early 2021. We’ll be the first ILC bank charter issued in 14 years—enabling us to build and run our own bank systems designed for businesses like yours.

While pausing loans was a difficult decision, we saw another way to assist more small businesses through this crisis: We quickly shifted our resources to help over 75,000 small businesses access Paycheck Protection Program (PPP) loans through the SBA. At the time, PPP offered a sustainable way to access funding during COVID.

As of now, the business market has stabilized to where we can responsibly offer loan access to some businesses. However, eligibility criteria has been tightened. If you previously qualified for an offer, that may no longer be the case. Please know we are reviewing all of these factors regularly, your offer status could change soon. If you do become eligible, we’ll send you an email, and notify you on your dashboard.

Like everyone, our goal is to work our way back to normal. But right now, our main focus is on responsibly providing the Square community with access to funding, and making sure we communicate with you—openly, candidly—along the way.

We can’t thank you enough for your patience. We’re glad to be back to support your business, and we’ll keep you updated as we move forward. Expect to hear more from us soon.

Be well,

Jackie Reses

Square Loans

[Jenn317]

I am so disappointed to read this response. I have been asking for support on this very issue for WEEKS. As my loan repayment comes to a close, I have been considering switching to PayPal as they are continuing to offer capital loans. I had no response from your team via email. I spoke to someone on messenger who told me to continue to pay off my loan and to keep my eyes peeled for a new offer. I've been waiting and waiting and waiting, as it's not a simple task to switch all ecommerce over to another platform. But it looks like that's what I'll be doing tomorrow, and my guess is -- you are going to lose a lot of customers because of it. I repaid my loan months ahead of schedule, sales are up over 200% from last year, and it's just unfathomable that you are not continuing to offer this. It's also shocking that this information isn't well presented within our capital dashboards. It should be noted that the program IS CLOSED. You need to update your message and be transparent across the board. I'll be closing my account tomorrow and heading to PayPal!

[ecantiques5]

@Jenn317 

You are absolutely correct and well spoken in sharing your views on Square and how they absolutely turned their backs on their sellers. I still CAN NOT believe they so deceptively lead sellers that were still producing revenue and in good standing to believe Square Capital was still going to be offered. The way a business handles this kind of treatment is to go elsewhere.

I wish you all the best in moving your business forward 😊

[Jenn317]

I just paid off my Square Capital loan, and was wondering — if I accepted a PPP loan, am I now ineligible for a capital renewal? 

[nika]

Hi @Jenn317- The team is reducing Capital loan offers at this time. Stay tuned on that thread for any updates that we push out regarding a change.

[Jenn317]

Wouldn't it make sense to update your information on Square Capital across the board? From the homepage where you're selling the idea of Square Capital to potential new merchants, to our Square Capital dashboard -- transparency is everything, especially during the 'new normal' that we are all going through. I can't imagine I'm the only one small business who during this pandemic was counting on/strongly hoping for an infusion via Square Capital. I can't imagine I'm the only one who due this -- worked hard to remain in good standing, increased processing through Square despite higher fees, and paid off current capital early. I am not arguing with your decision (pointless anyway) I'm more so arguing with your lack of communication. Had someone answered my first email (sent May 4th), I would have promptly moved over to PayPal. Instead your team kept me (and others) in limbo for weeks. The good news is that my loan is paid off, and now there is no reason I need to keep my account here! I will be heading to a new company, and I hope that those who can will also move to other processors. The best way to send a message is with your $$$. 

[jrayaronhalt]

Thank you for your response but this does not answer the question at hand. Will we see Square Capital loans return in the near future? I understand you are willing to work with those who are unable to repay their loans, but those of us who are still operating normally would like to do so with the available capital in our business.

Thank you for your time.

[ecantiques5]

@jrayaronhalt 

See your comments hits the nail Square on the head. They are doing something to help the ones that cant meet repayments minimums, BUT LOOK AT THE NOTHING they have offered the ones still processing revenue.... in fact we have been treated profoundly UNFAIR.

IT DOES NOT HAVE TO BE LIKE THIS.

[bigpoppi]

They have to work with them because they own them 10's of millions of dollars! Us, we just keep on paying. They haven't figured out they need sellers like us to make money to keep the doors open. If we leave, what do they have left? Those that are all in default or out of business!

[Mindysue711]

I’m very surprised you aren’t offering it anymore.. one of the biggest reasons I stayed with square.. now I really have no reason to stay with it as a card processing option.. I feel square should of let the business decide weather they wanted to accept the capital loan offer.. I myself haven’t lost any income and have been using square right along! And to be honest was counting on the square capital loan this spring!! 

[CCARLLSON01]

This message from Regina at square is so generic and repetitive.  Problem with Square is there is no relationship building with them because they are robotic answers and have left us with no hope if an outcome.

[Wvcupcake]

I have been fortunate enough to use Square capital for almost seven years now. I have never had a delay or an issue. I have never paid as much into my Capital as I have now with no new offer. I have reached out and of course get the generic if you're eligible you'll get the offer but quite frankly I depend on this to run my business and I am greatly concerned. We were allowed to continue operating during covid-19 pay back our Capital at the normal and expected rate, no disputes, no issues at all. I am very concerned.

[Wvcupcake]

Regina it's been 2 months since you posted that square had to pull back on their Capital funding. Obviously that was in the worst of covid-19 and understandable in a way. But as someone who has relied on this influx of capital to keep my bakery running for almost seven years now without any issues or any problems I need answers. As do all of these other people. I absolutely understand that businesses having to close and less sales means less income for square but we need answers. Please help us. To be told that you will get your offer when you are eligible and you know from 7 years of history that you are past being eligible with no offer tells us that something is very wrong.

[bigpoppi]

@Wvcupcake - where's your bakery? Maybe we can support you through purchases?

[Wvcupcake]

Big Poppi bless your heart, I am just outside of Charleston WV. We are the longest single owned Cupcake Company in the State, but frankly this may ruin us. I'm literally crying and baking 😂😂😂

[bigpoppi]

@Wvcupcake - I think I found you on FB and sent message about ordering...

[Wvcupcake]

I didn't see your message, we are Lil' Bit of Heaven Cupcakes ❤️

[JP9]

Hello Regina,

Thank you for replying to the sellers and providing information about the Square Capital program being on hold.  Since the June 30 deadline has passed, when will Capital loans be extended again?  I was not eligible for a PPP loan and need a Capital loan to help get my business off the ground again.

Thank you in advance.

J. 

[Stephanie-pierc]

The funny part about square at the moment is that when you contact square capital you get the very vague response that “eligibility is checked daily and keep checking your dashboard and email for offers” I have received 3 email stating the same exact thing. They are literally copying and pasting response emails out. Regina on here says thy put offers on hold but to get someone at square to actually say that hasn’t been done yet. Many people are shopping around for other processing companies that will be honest with how their business is run during this pandemic. It’s getting ridiculous. It has been months now and not 1 person has received an offer or an explanation of when offers will be sent out again. I hope square gets it together quickly or they will be losing a lot of customers. 

[Hairgirlval]

Is it true that the capital program has been done away with?! I’ve been a loyal square customer for 7 years and always count on the capital. Knowing that I was close to 80% (which is usually when I get an offer) has been my only saving grace during the North Carolina shut down. Now I’m at 80% and haven’t heard anything , I’m really discouraged, after I pay my loan off if the program isn’t back I’ll be looking into another payment system 😞 

[ashc]

Hey @Hairgirlval,

There's some misinformation going around but it's not gone for good. They've dramatically slowed Capital loans to be able to offer PPP loans at this time but they will be back.

Capital should have messaging about it coming in the near future. 

[JP9]

Hi Ashley,

Thank you for replying. I don’t think it’s right that Square would suspend (or drastically reduce) the Capital loans at a time like this. Not everyone qualifies for PPP.  I’ve been working really hard to pay mine down and get all the sales I can do that I can get my next Capital loan to get my website back up and running.  Im not eligible for a PPP loan.  I’m at 81% and have had consistent sales. I would really appreciate if you could look into this for me.  If you’re still doing some Capital loans, please consider mine. 

Thank you,

J.