Square is launching yet another banking product.
The payments company announced a debit card for businesses on Thursday that lets Square sellers using its credit card processor get immediate access to money from sales. The product encourages merchants to keep funds with Square instead of depositing them into a bank account.
The product marks Square's latest tiptoe into the banking world.
The San Francisco-based company in December refiled its application for a bank charter, which would allow it to take federally insured customer deposits. Through Square Capital, the fintech firm has slowly rolled out other bank-like products, such as small business loans and the ability to pay in installments.
Square already offers a Visa debit card linked to its popular peer-to-peer Cash App that CEO Jack Dorsey, who simultaneously runs Twitter, has saidcustomers often treat like a bank account. Former Square CFO Sarah Friar, who left the company last year, also hinted at a move into banks' territory and said that "anything you do today with a bank account, you should look to the Cash App to begin to emulate more and more of."
Because the company can't take deposits until it has a bank charter, Square partnered with Sutton Bank, which will store and insure the customer funds. Square executives underlined that the account itself is just a balance that you can move funds in and out of, and it is not FDIC-insured.