Square Is Teaming With AmEx to Offer a Credit Card for Square Merchants

Merchants in the United States that use Square’s point-of-sale technology and also accept American Express will be getting a credit card from Square in coming months that will run on AmEx’s network. The so-called Square Credit Card is said to be the first credit card the Block Inc. unit has offered to its network of sellers.

The card, which will be issued by Salt Lake City, Utah-based Celtic Bank, will be supported by technology provided by i2c Inc., a card-issuing platform for both physical and virtual payment cards.

Much information about the card was not immediately available Wednesday, including how many merchants are expected to receive the card and when. Square says in a short news release that it will “announce additional details about the card and benefits next year.” A Square spokesperson tells Digital Transactions News by email that the company has “no additional details to share at this time.”

Square does say the new card will be integrated with the POS and business-management technology it offers merchants, allowing sellers to “organize their finances and manage their cash flow from the same platform they use to run their business.”

Square’s parent company, Block Inc., reported earlier this month total payment volume for Square sellers in the September quarter came to $50 billion, up 20% year-over-year. Merchants doing $500,000 or more in annual volume accounted for 40% of that total, up from 37% a year earlier, indicating Square’s steady movement toward larger sellers.

The AmEx card for Square merchants follows efforts Square has pursued in recent years to expand its sellers’ access to credit, including direct loans. The company in 2020 obtained a bank charter through an industrial loan corporation to support new banking services. Indeed, that charter leads some observers reached by Digital Transactions News to question why Square is not issuing the new card on its own banking license.

For its part, Square would not comment beyond the information in its release. “Square has spent years building a successful lending program to eliminate this barrier for sellers, and we’re uniquely positioned to innovate even further in this space to expand access to new types of credit products,” said Luke Voiles, general manager of Square Banking, in a statement.

The new card for Square sellers follows efforts AmEx has made in recent years to embrace non-traditional issuing opportunities. Earlier this year, AmEx announced it would make its network available to fintechs interested in launching payment products in conjunction with the New York City-based card giant.

Now, the link to Square “is a big win for AmEx,” says Patricia Hewitt, a payments analyst at PG Research & Advisory Services. “They’ll have access to many more accounts.”