Good news, bad news, eh @cmeshine. There are a number of reasons that COULD be part of why your new offer was lower.
- Square might be slowing down on how much loan exposure they want to have on their balance sheet. They are, after all, a publicly traded company that has to answer to their shareholders and investors.
- If our sales are flat or at least not growing at a good rate to cover inflation and higher interest, then Square’s algorithm understands that inflation is eating into our available cash to pay bills, etc. Flat sales (or very slowly growing sales) are always red flags to lenders, Square or not.
- Sometimes how long it takes us to pay off our current loans can be a factor. Let’s say that previous loans were paid off with automatic payments in 8-10 months in the past. But for this current loan it took us 12-15 months. That tells Square that our card processing volume can’t keep you with higher loan amounts. Yes, they give us 18 months to fully pay a loan, but they obviously prefer that we pay them off closer to the 12 month mark.
- If our cash/card ratio drastically changes, and cash spikes or is consistently higher than historical for our business, that is another red flag. Since Square must only consider card volume when calculating repayment rates this can become a problem.
Of course, I’m not saying that any of these contributed to your lower offer. I’m just throwing out a few reasons why this CAN happen.
Hi @Kpramos65. Square Loans are going out regularly. I have received one offer a week for the past month or two. Having said that, it seems that new offers for existing customers are still being delayed. While they used to start sending new offers at as low as 70% completion, that is not the case right now. Most offers I’ve heard about are not starting until the high 80% and low 90% and many sellers aren’t receiving new offers until their existing loans are paid off, with some waiting for a few weeks after they’ve paid their loans off. Everyone is different. Something about your account is causing the loan black box to delay a new offer. Once it is ready, you will receive one, I’m sure. Good luck!
Has anyone in August 2024 gotten any offers .or any insight as to why it's not getting a offer at 83 percent
Been with Square for going on 5 years now and a few more months had several loans in the past one was 16k one was 24 one was 34 one was 49 one was 46 last one was for 69 always like clockwork would always get an offer by 80%. Always paid on time ahead of time and we surpassed minimum payment every time .and it's like now at 83% and no offers what's going on I know square has made a ton of money off of me from credit card processing and all in the total of five years probably have processed well over 2 million dollars and square seems to not give a crap about its loyal customers when they need a loan the most very disappointing as soon as this one is paid off I am really looking into getting a new credit card processor with the fees that they charge you and everything else they're making us jump through hoops it's crazy
Hey @Tyconcrete. I can give you some insights but of course no concrete answers.
First, loans ARE going out. I’ve gotten a half dozen offers in the past few months, but I’m not in the market for a loan through Square right now.
Second, almost no one with a current loan is getting new offers at 70-80% currently. This has been the case for well over a year and I don’t see it changing anytime soon. Why? Because if you read the news, or follow the financial journals, you’ll see that all lenders are being very conservative about how much they have on their balance sheets. Rates with the Fed are still high and will only come down slowly. There is talk every day of a looming recession, which I think is crazy since the signs for recession just aren’t coming together. But markets don’t like that kind of talk. The point is Square is not the only lender who is holding back. I’ve seen sellers here waiting until the 90% range to get a new offer, and more than a few who completely paid off their existing loans and then waited a while before a new offer showed. This, as they say, is just the way it is. The lending market is being highly conservative and cautious. Hopefully, that will change soon.
Lastly, it seems like the point of your post was to say bye because you are just sure that there are better card processors out there will give you all the money you want when you want it. If that’s the case, I wish you well. It’s really never a good idea to switch card processors just because of the possibility of loan availability. I know a few folks who did that and regret it. One is still waiting — after a year —- because they are still building up card processing history with their new processor. One other I know is very disappointed that they are only getting offers that are half what they were with Square. Another hates her repayment terms. Point is, the grass is almost never greener on the other side. It’s still just grass.
One more thing. This year I realized that my cash flow and sales were more than sufficient to qualify for a traditional Line of Credit with my local bank. I applied — solely on the strength of my business credit and profile — and was approved. Many of us find here that there comes a point where the Square repayment terms (which are, after all, merchant cash advances and not traditional loan terms) just don’t work for us or make financial sense. It’s not the fault of the Square Loans — they serve their purpose quite well and help lots of folks getting started. Anyway, I found that it was a good idea — and finally time — for me to move on from Square loans and find something with more traditional repayment terms, etc. From seeing the numbers you freely shared in your screen shot, I suspect you might be one of us. But, of course, that is unsolicited advice, eh?
Regardless, I wish you well. And, if this LONG reply is too much — and all you meant to do here was gripe and complain and didn’t want feedback — then please accept my apologies.
Hi @Fromwithin. Square Loans are still going out. To clarify some widespread confusion, though, understand that just because everything is “green” does not mean that loans SHOULD be offered. The status page only shows what big issues might be present with our accounts so that we can hopefully fix those.
However, other factors come into play. These include things like Square having limits on the total amount of loan risk they are willing to take and have on their balance sheets. Another good example of when we might be “green” and still not see a loan is this scenario. Let’s say that our card processing volume this year is very close to or slightly above last year. In this case, because of persistent inflation and high interest rates, our ability to repay a loan might be considered lower. Like most lenders, I would imagine that Square likes to see not only growth year-over-year, but they need to see marked, steady growth. Stagnant sales do not give lenders confidence that loans can be repaid in an economy with high interest and still growing inflation.
Obviously, there is no way to know for sure. Since Square is not obligated to offer loans we are at the mercy of their algorithm. I just wanted you to be aware that the loan dashboard doesn’t give you the complete picture, nor does it say “all good so we WILL get a loan.”
Anyway, I can attest for sure that loans are going out. I’ve received 4 offers over the past few months. I’m just not interested at this time.
Square has definitely NOT stopped loans to F&B sellers. I sell ice cream. I’ve received over 4 offers in the past few months, and I’m not even in the market for a loan. I know a local coffee/pastry shop seller who is also getting regular loan offers. It’s never a good idea to generalize because of our own experience, because that scares others needlessly. So, for anyone reading this, the F&B industry IS getting loan offers. However not ALL F&B sellers are getting loan offers. That’s about all that can be said, really.
