Square’s Utah Bank Now Open For Business

Square is now operating its state-chartered industrial bank, Square Financial Services, in Utah after the state’s Department of Financial Institutions gave it the green light, according to a press release emailed to PYMNTS.

Square submitted its application back in September 2017. From there, it was amended in December 2018 and finally approved as of March 17, 2020, the release stated. Now, a year later, as Square has satisfied all its opening requirements, it is ready to open the business.

Square Financial Services plans to offer banking services like deposits and other products, according to the release. It will primarily service a nationwide market of small businesses, including those which already operate on the Square payment processing platform.

Square Financial Services will now be the 16th Federal Deposit Insurance Corporation (FDIC)-insured industrial bank operating in Utah. It is the second de novo industrial bank to open in Utah since 2008, the release stated.

The release noted that Utah industrial banks had a total of $171 billion in assets as of Dec. 31.

Last March, FDIC Chairman Jelena McWilliams said Square had “satisfied each of the statutory factors required for approval, subject to certain conditions,” adding that one such condition was for a bank to keep up levels of capital “significantly higher than typical FDIC-insured banks,” PYMNTS reported.

Square Financial Services CEO Lewis Goodwin and Chief Financial Officer Brandon Soto, both of whom have a wealth of experience in the field, will lead the bank.

In separate news, Square reported omnichannel sellers, or those who sell in both physical and online channels, made up 50 percent of the gross payment volume (GPV) as of the fourth quarter. According to the company, much of that came from peer-to-peer (P2P) payments, and the gross profit per monthly active trading was $41 per customer, an increase of 70 percent from the previous year.

The company also spent $170 million on bitcoin in the quarter, using $51,000 per coin acquired.