Square is once again expanding its product ecosystem with the launch of a free debit Mastercard for its merchant sellers. According to Square, the debit card will give small businesses immediate access to funds from the payments they accept. The debit card is also meant to help merchants with money management, preventing the commingling of personal and business funds.
Unlike Instant Deposit -- one of Square's biggest services -- the debit card is not affiliated with a bank account and draws purely from the merchant's Square balance. The Square debit card is also not ensured by the FDIC, as it's not a standard financial account.
Instant Deposit differs in that merchants transfer their sales balance to a linked bank account and are charged 1 percent of the deposit amount for the service.
Without knocking Instant Deposit, Square is touting the new debit card as a way for merchants to simplify access to cash. Merchants can also view Square Card activity alongside a record of sales in Square Dashboard and Square Point Of Sale, as well as access reporting features that separate business and personal expenses. Merchants can also withdraw funds from the Square Card via ATMs.
There's also a branding component to the Square Card, as sellers can personalize the card with their business name and logo and the signature of the cardholder.
"It's like a calling card for their brand," said Christina Riechers, Square product lead. "This might be one of a business's first forms of brand identification."
The cards are also the same shade of white as the Square hardware lineup.
San Francisco-based Square, headed up by Twitter CEO Jack Dorsey, has greatly diversified its portfolio over the years, expanding into corporate catering and lending, and building tools for email marketing, payroll, and customer management. Its hardware portfolio is now one of its smaller revenue lines, although the company introduced the somewhat higher priced Square Terminal in October that could help grow the segment over the long run.
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