The Federal Deposit Insurance Corporation (FDIC) Board has voted to conditionally approve Square’s application for deposit insurance related to its Industrial Loan Company (ILC) bank charter. Square has also received charter approval from the Utah Department of Financial Institutions.
The bank, Square Financial Services, is expected to launch in 2021. It will operate independently as a direct subsidiary of Square, Inc.
Its primary purpose will be to offer small business loans for Square Capital’s commercial lending business and to offer deposit products.
“We appreciate the FDIC’s thoughtful approach to our application and their recognition that Square Capital is uniquely positioned to build a bridge between the financial system and the underserved. We’re now focused on the work ahead to buildout Square Financial Services and open our bank to small business customers.”
Jacqueline Reses, Square Capital Lead and Executive Chairwoman of the board of directors for Square Financial Services
Square Financial Services CEO Lewis Goodwin and CFO Brandon Soto will lead the bank’s executive team; both bring decades of banking leadership experience to Square and have managed multiple ILCs over their banking careers.
As the ILC prepares to open, Square Financial Services will make additional hires for its bank headquarters in Salt Lake City, Utah.
What do you think about Square becoming an FDIC insured institution so it can offer small business loans?
Please use the comments section below or head over to our Facebook Group for Small Business Sellers and interact with other small business owners.