Square has just launched the ability for ACH direct deposits, allowing users to put their paychecks and other deposits directly into their Cash app balance.
The company made the announcement on Twitter, writing “PAYDAY! Cash App now supports direct deposits for your paychecks. Give your employer the account and routing number in your Cash settings, and we’ll notify you the second that direct deposit hits.”
According to news from TechCrunch, users can set up the service by accepting a disclosure. Afterwards, they’re given an account and routing number so employers can start making the direct deposits. A notification is sent when a deposit is transferred into the account, with the funds added to the Cash app balance.
At this time, Square doesn’t have a bank charter. But this feature — coupled with the app’s debit card that is issued by Sutton Bank — enables the company to provide traditional banking features to its customers.
The direct deposit feature is being offered through Lincoln Savings Bank, which is providing a routing number and a new account number to Cash app users.
Last month, Square revealed that 7 million people used its cash app during the month of December. In addition, Cash customers spent more than $90 million during the month.
Cash is also currently the top free finance app in Apple’s U.S. iPhone App Store — one spot ahead of PayPal and three spots ahead of Venmo. The app generates revenue by charging customers a 1 percent fee to access same-day withdrawal of the money they’ve received (if they don’t want to pay the fee, they will get the money the next business day), as well as by allowing businesses to accept customer payments through the app.
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