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

[bigpoppi]

Still crickets!

[Wvcupcake]

Yep. Nothing but crickets.

[LegacySS]

Guarantee you all there is no offers.  We DEFINITELY would qualify and no offers.  If anyone gets an offer please post so we all know but i know for a fact we would be eligible and yet nothing.  Crickets!!!  Find other solutions folks.   

[LegacySS]

its frustrating for sure but Square makes money on us and they make money on capital loans.  My guess is for every good customer they have they have 5-10 bad ones who cant pay it back!!  Kabbage isn't extending anything either so its not just square to be fair.   National Funding and Fundworks are the best options right now.   Get one of those and when square finally opens up use that money to pay off the other options if you can.   We are doing so well we don't need the capital loans so we are happy but like many of you we use to NEED these to grow.  Its a shame they can't just be honest with everyone.   Customer service is the key and we see how they are in that category.   Terrible 

[agavr2626]

I spoke with someone at Celtic Bank (the bank that lends square capital loans) and she said that the rep at Square Capital told her that they are not doing capital loans right now. So, yes, Square is lying. 

[RadioMcG]

Honestly, by the 1st, if there are still no offers, we all need to go elsewhere if capital is something you are seeking. I was hopeful this month, but still nothing for those of us here who have proven that our businesses are still thriving and capital will continue growth. It will be time to move one, it will take time to build up the revenue with another POS system, BUT it is worth the time at this point. Square has ZERO information about when this program will return. I am done after August 1st. 

[SteveO]

I am on my 5th loan, 87% completed and way ahead of schedule, like my previous 4 loans. My processing has actually increased over average.  I am very disappointed I have not received another loan offer.  I have ordered a PayPal reader and Square will be getting only the minimum amount required per 60 days for the remainder of my loan.

[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

[Jwp32708]

Ms. Reses,

I wish to respond to your recent posting. I have been a loyal customer to Square for over six years. Have processed nearly $1.5 million dollars in transactions though Square. Over the past six years, I have utilized the Square Capital program. We have been offered and paid off nine loans through the program for a total of nearly $190k.

And for years, we have been told that the Square Capital program determines a business’ eligibility for a loan through Square Capital based on several factors to include new business, growth, chargebacks, but more specifically, an algorithm that determines eligibility.

To me, the use of an algorithm takes the emotion out of the equation and bases its decision on facts.

For months, your team at Square Capital continued to tell its customers that funding was still ongoing and that the “algorithm” still determines eligibility.

Obviously, this was not true.

When it comes to merchant card processing, Square is certainly not the cheapest, but the various services that you provide makes it palatable.

The decision by your management in not being transparent with regards to the Square Capital program has left a bitter taste to many, and possibly cause many businesses to rethink their options when it comes to merchant card processing.

So at this point show your hand, lay your cards on the table, and be transparent with the Square Community as to what other changes should we be seeing in the near future so that we can make an informed decision whether or not to continue to support Square or not.

[oneggorin]

I looked at this new deal they have out I am an essential Business and have had record sales this last qter and have alway been well ahead of the pay schedule and it still says that i am not  eligible this is not logical i am a no risk business they claim the covid as being one of the reasons

here are there reasons for not giving a loan to my Co

Local COVID-19 orders

The status of restrictions in your state can impact your eligibility.

Payment volume

The more card sales you process through Square, the better.

Payment frequency

Consistent sales through Square shows us you have a healthy business.

Customer mix

these are Square's  reasons given

In the last 3 months we did more than 3 times the the total of the last loan we were given so 

  I think they are still not being honest with us about the loans!

[bigpoppi]

@oneggorin @RadioMcG @Joe 

Yes, I saw the new dashboard as well today.

Just finished paying off my 8th or 9th loan this week. Always ahead of time. I'm also an essential business, all online but am based in California so they appear to be using that as a possible reason because of the state shutdown. Funny thing is I haven't been in Cali since lock down started.

I've never had a chargeback because of my clientele and my numbers the first 6 months were my biggest ever...Also, even mix of 50%-%50 new vs returning each month. I throttled back by business I run through square 90 days ago when I realized what was up.

Let's see if they are being truly transparent or not and if they are going to start funding businesses again. 

There was a very negative article about Square in the NY Times about a month ago and how their withholding funds, etc were putting some folks out of business.

I guess we need to see how this shakes out.  

[Jwp32708]

Do you have a link to the NY Times ad? I would be interested in seeing that.

[alchemy33]

My guess is that no one is eligible right now. It's an easy way for them to buy time, and keep merchants hooked on Square. They've created the illusion that capital loans are coming -- but we are weeks (if not months) away from that actually happening. I would be SO happy to be wrong on this, and if someone is deemed eligible I hope they chime in! 

[Joe]

Hi everyone. I want to jump in and clarify that the post above from @RadioMcG is a copy and paste of a correspondence from Jackie Reese sent out early this A.M.

While we are happy to pass along general feedback, it is important to note that any replies to this specific post above will not be direct response to Jackie here on the Community.

Thank you! 

[RadioMcG]

I apologize for not clarifying that. Trying to edit the post to add those details. 

[Joe]

Not a problem. @RadioMcG! Thanks for the quick response!

[SteveO]

Where was this originally posted?  I cannot find it.

[Jwp32708]

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 Capital

With regards to Jackie Reese's explanation of Square’s decision of starting their own bank that will be launched in early 2021, it is another example of a “dangling” carrot. Does this mean that Celtic Bank will no longer be offering loans, and if wanted a loan, will need to wait until 2021 when Square launches their new endeavor?

I think that all the Square Community is asking is the Square Capital program being brought back in 1 month. 6 months? Or a year from now? Once again, all we want is transparency.

[danengine2004]

i called them about that note they put out - what i was told is that the CAPITAL PRORAM IS back and lending But WITH RESTRICTIONS BASED UPON GEOGRAPHY ETC. - ONCE AGAIN SQUARE IS SHORTSIGHTED THEY THINK EVERYONE IS A RESTAURANT OR BARBERSHOP - I HAD A 100K LOAN TAKEN ON 03/21 PAID OFF 07/30 - BUT BECAUSE I AM IN ILLINOIS I AM INELIGIBLE - BUT THEY TOOK THUER FULL 15.25% EARLY - PLUS THEY NOW CHARGE 3.51% ... GOT AN EMAIL FROM ANOTHER PROCESSOR THAT OFFERS .03% - SO LOOKING INTO IT - I GUESS $42k IN PROCESSING FEES IS NOT GOOD FOR SQUARE - 

[Jwp32708]

So what is their geographic restrictions?

[bigpoppi]

@Jwp32708 - I'm sure they'e going by closed states, open states, etc.

My mailing address is California so I'm screwed but yet had my biggest 5 month period with them since February... Go figure!