Square Is Expanding Lending and Payment Services With Two Competitors
Square announced a new partnership on Monday that would allow restaurants and retailers that use point-of-sale hardware and software made by competitors TouchBistro and Vend to access Square’s software and services, including lending.
Founded and led by Twitter CEO Jack Dorsey, Square sells credit card readers that attach to mobile phones or iPads. The company has also expanded into small business loans amid other software services pitched toward small to mid-sized merchants.
Over the past few months, Square has been expanding its lending services to merchants who don’t use the payments company’s point-of-sale hardware.
TouchBistro, a point-of-sale service used primarily by restaurants, and Vend, a similar point-of-sale hardware popular among retailers, can now offer their merchants the ability to access many of Square’s services. These include invoicing, analytics, quick deposits, and even lending.
Square’s business lead, Francoise Brougher, explained that this is a “evolution for Square” because the San Francisco-based company is moving from a closed system toward an open one.
Brougher declined to reveal the financial agreement between Square and the two companies.
A few weeks ago, Square announced a similar partnership with Upserve, a startup that offers software and its own point-of-sale service to help restaurants manage their businesses. But the deal with Upserve only extended to lending arm Square Capital.
It’s not surprising that Square is expanding its services beyond just the millions of businesses who use Square’s point-of-sale hardware. New customers will only continue to grow the already burgeoning business. Revenue from Square Capital, along with the company’s other software services, was up 130% to $30 million in the most recent quarter from the same quarter in 2015 as well as up 25% from the previous quarter in 2016.
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Lending is proving to be a fast growing sales driver for Square. During the second quarter of 2016, Square extended nearly 34,000 business loans, totaling $189 million—an increase of 123% year-over-year and 23% from the previous quarter in 2016.