San Francisco-based FinTech company Square, known for its white card readers, has once again decided to become a banking establishment, according to a report in The Wall Street Journal.
The company had previously asked to start a bank in September of 2017, but eventually withdrew from the process over procedural issues.
Square said it’s going to resubmit the necessary paperwork with state and federal regulators to start a bank in Utah, which could happen as soon as Wednesday (Dec. 19).
Since its inception as a credit card-reading company for small businesses, the operation has since expanded to offer other services, like digital money transfers and retail installment loans.
The banking license would allow Square to forego the route of having to weave through other financial institutions for its customers’ financial needs. The bank will be led by Lewis Goodwin, a former executive at Green Dot, and capitalized with $56 million from Square. There won’t be any actual brick-and-mortar branches.
The venture, called Square Financial Services, recently acquired an office in Salt Lake City with room for up to 30 workers. According to the application, Square said the banking license will allow it to provide financial services to businesses that can’t get help from traditional banking entities.
Square said it has already given out more than $3.5 billion in cash advances and loans through Square Capital, its digital lending subsidiary. According to the company, most of the businesses borrowing money report that Square is their only source of financing.
Jacqueline Reses, who leads Square Capital and will be the chairman of the bank, said the bank will have a unique opportunity to serve businesses that don’t usually get access to financial help.
“Square Capital is uniquely positioned to build a bridge between the financial system and the underserved, creating access for small businesses to both capital and the economy,” she said.