Square bank

Square is Officially Becoming a Bank in 2021

Square and Banking Charter

Square has been leading the way in financial services. The company launched its small card reader quite a while back that helped small businesses and organizations accept cards without hassle. It then evolved to deploying point of sale terminals before launching the cash app. Square also started deploying loans to merchants and is becoming a critical partner to those who aim to conduct commerce online.


You can utilize tools such as Squareup and Weebly to conduct seamless commerce online. You can see that it started out by providing tools to small businesses to process payments and has grown to provide them with capital to grow and connect with more customers. It built an ecosystem for businesses and consumers and now is becoming a bank.

The Square Bank is for Businesses

The company is just getting started and has many more features and plans ahead. We see that the latest news from Square during these COVID-19 times is that it received conditional approval to run Square Financial Services. Based in Utah, the firm will also have the green light from the local state authority to operate there as well.

Square will have a commercial banking entity that accepts deposits and provides loans. Of course, the bank will not be a big revenue booster in the present year as it is getting started. But it should have a material impact on the firm moving forward in the coming years.

It is an interesting move by Square. The payments firm incorporated bitcoin and is leading efforts in other areas to champion decentralization. Obtaining a banking charter makes it to where the firm adopts the ways of traditional industry players while being innovative.

Further, the bitcoin integration did have a material impact on its business as the firm was able to see more than 40% of its revenue from bitcoin-related transactions.

Square and Bitcoin

Bitcoin is a decentralized peer-to-peer payments network. It processes payments where individuals can obtain bitcoin and send value to anyone across the world in a censorship-resistant way. Dorsey, the leader of Square and Twitter, has an investment in Lightning Labs, a layer 2 bitcoin network solution. Further, Square is investing in Transparent Financial Systems to bring about a more effective clearing network.

How will the company square its growing centralized banking ambitions with it’s decentralized vision? On the one hand, the company seeks to innovate while on the other, it must appease shareholders, generate further revenues while building long term shareholder value.

I’m excited for the de novo industrial loan bank as it shows that Square is growing and will have more potential but I also know that you can only focus on one vision at a time.


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