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Review of Square Capital

Amy Noel

Overall Experience
Cost
Customer Service
Speed
Our business has used square capital 3 times. The first two loans were relatively small and paid back in less than 6 months. We then were offered a third loan much higher and honestly, it was hard to resist thinking about the no hassle access to funds into your business in 1-3 business days.Users however need to be aware of the following: Square automatically takes their cut from total credit card transactions, not actual business profit. Meaning, if a customer is charged $10 for their meal and they pay another $2 in tax and offer a $2 tip, their card is charged $14. The business is making $10 but since the card is processed for $14, Squares payment is taken out of the $14. This may seem like no big deal in small transactions and if folks are paying with cash at least half the time (as Square can't take from that) but we're in the food industry and folks are rarely paying cash. About 85% of our sales are with a card. We charge sales tax and our employees get great tips so ultimately Square is considering the funds as a part of their payment.What does this mean? When making payments to Square through your "sales", you are ultimately paying Square more than what your business is actually making. Our business pays Square back about $1000 a week.. just about $4000 a month which is not really reasonable. What business can pay back a loan that fast? It's my fault as I didn't realize this until later and now I'm stuck paying it back in this way.. there's no other option to sort of slow things down as far as paying them back.I've asked them about this and they said they would "bring it to their team." I've also contacted them to get a lower transaction fee rate because according to their website, our business does qualify. They took my info and passed it off to the "appropriate department." I never heard from them.If you just need a quick advance, it's a great tool but if you're looking for a much larger loan to get your business off the ground, try to look elsewhere first where they give you time to pay off your loan. I realize not everyone qualifies for things like that but just be aware. Square really needs to provide some more options for this.