Square has been approved as a lender in the U.S. government’s emergency lending program—becoming the latest fintech platform to be given the green light.

Twitter founder and Bitcoin backer Jack Dorsey’s payment processing company joined the likes of PayPal and Intuit QuickBooks in being approved to take part in a program designed to offer relief for businesses slammed by the coronavirus pandemic.
Square is now authorized to offer Paycheck Protection Program loans on behalf of the Small Business Administration, which are designed to support small businesses, self-employed workers and independent contractors.
Eligible firms can take out a loan that comes to 250% their average monthly payroll expenses. A 1% fixed interest rate is in force for the entire term of the loan, which is forgiven in full if the whole sum is put towards payroll costs or other eligible costs like healthcare payments, rent payments and utilities.
Squarely behind crypto

What’s particularly interesting about Square’s involvement is its full-throated enthusiasm for crypto. While Square’s premiere product, Cash App, isn’t built on a blockchain it integrates Bitcoin closely, acting as an electronic wallet and allowing users to buy and sell the first cryptocurrency directly.
Beyond that, the company has been expanding the Bitcoin services offered in its Cash App—and, in the fourth quarter of 2019, almost half of the revenue it generated came from BTC.
In September, Square launched its Square Crypto division, announcing it was building a developer kit for the Lightning Network, a second layer on top of the Bitcoin blockchain that allows easier and faster payments. Square Crypto was recently granted a patent for a payment network designed to make simple and seamless transactions between cryptocurrency and fiat cash.
The program could help Square gain awareness as an alternative to traditional banks in the small business community, and in turn, this could lead to Bitcoin’s popularity as a payment method among merchants and consumers growing more sharply.
A seat at the table
Despite traditional banks struggling to get the Paycheck Protection Program off the ground, the more nimble fintech firms had to fight for a seat at the table.
The U.S. government had initially focused on asking traditional banks to help the SBA disburse loans worth $350 billion to small companies. Fintech brands were not invited to play a role in the stimulus package, prompting aggressive lobbying from Financial Innovation Now.
In a letter to Congress on March 19, the industry group wrote: “Millions of truly small businesses, those most likely to fail in the coming weeks, will not be well-served by loan guarantees made available exclusively through financial institutions. Small businesses need capital immediately.”
The group urged U.S. lawmakers to “leverage digital advances in the marketplace” to ensure stimulus could reach those who need it—and reduce a reliance on physical bank branches, many of which were closed because of COVID-19.
To hammer home the incentive of including fintech companies in this Herculean effort, Financial Innovation Now dangled a carrot to these politicians: “FIN estimates that our companies could rapidly disburse approximately $100 billion in capital to vulnerable small businesses, in many cases within weeks.” That’s a hefty chunk of that $350 billion milestone.
Dorsey gives back
Jack Dorsey, who founded Square alongside Twitter, hasn’t been afraid to put his money where his mouth is in the fight against the coronavirus pandemic.
Last week, he announced that he was giving away $1 billion—more than a quarter of his fortune—to start a fund that will focus on providing global COVID-19 relief. From there, Dorsey says, the focus will shift to girl’s health and education, and universal basic income, an economic concept that has been gaining traction in some parts of the world.