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How to Transfer Money From Square to a Bank Account

Square is an American financial and digital payment company that operates from San Francisco, California, in the United States. The company started operating in 2009 under the leadership of Jim McKelvey and Jack Dorsey. It launched its first platform in 2010 and even went ahead to trade as a public institution on the New York Stock Exchange with the ticker symbol SQ starting from November 2015. We shall see how to transfer money from Square to a bank account later in this article.

You need to transfer your funds from Square to your bank account once you have received payments. Since Square is primarily for business payments, you have to move money to your bank account associated with your business. Money in a bank account is more secure compared to when in your Square account. I am not saying that it is insecure to use Square, but such apps are always a target by fraudsters, and if not careful, you can lose your money.

It is essential to understand how Square operates. Well, the platform processes your payments from customers. It works with point of sale machines to automatically accept payments from customers who also have the square app. You can easily integrate your business website with the payment service so that when customers check out, they can go straight to the payment section. Transactions are end-to-end encrypted to ensure that no third party can access your accounts.

How to get started with Square

Getting started with Square is easy as you only need to create an account online. You can open an account online using the Square App or website by just entering the required details. To sign up over the web, you can follow the steps below.

  • Go to squareup.com
  • Next, click Get Started.
  • Enter your email and confirm it by clicking on the link sent to the email.
  • After that, create a password and tap Create Account.
  • Next, select your business type from the drop-down menu, then key in your business as well as your personal information.
  • After that, click Continue.
  • Answer a few questions to help with your account verification.
  • Next, click Continue.
  • Enter your email address or phone number in the space provided. Square will send a download link to your mobile device to get the Square Point of Sale app from the relevant site. 
  • Tap the link to download the app.

After creating your account, you will be able to sign in on multiple devices using the exact login details. You can also create a Square account from the Square app as follows.

  • Download the Square Point of Sale app to your mobile phone.
  • Hit on Create Account to start the application process.
  • Input your personal and business details to answer a few questions.

You must use a supported device to get started with your application process. There are some versions of Android and iOS phones that cannot work with Square at all. As soon as you complete your application, Square will ship a reader to your physical address, and you should get it within ten business days.

As you wait for the reader, you can start accepting payments via manual entry. In fact, Square is a good option for you to send money to someone without a bank account when making payments.

What details do I need to open a Square account?

how to transfer money from square to bank account

There is a need to verify the real identity of people opening accounts such as Square. Therefore, there are various details needed for that. The federal law requires you to have the following details when opening a Square account.

  • Social Security number (SSN)
  • Full legal name
  • US-based bank account
  • Date of birth: Current credit card regulations require at least 18 years of age or to create a Square account.
  • US home mailing address

If you are a merchant, you will have to provide the ITIN to get on board, and your Square will get in touch with you if you qualify. Remember that you can still use the Square payment platform to accept payments if you have not provided the above information.

However, you will not be able to accept card payments. Again, you will still be able to use Square to track your cash payments and give your customers text and email receipts.

How to transfer money from Square to a bank account

You have various options to transfer money from Square to your bank account. Despite the option used, there are general guidelines to move money to your bank account. To link your bank account to Square, you can follow the following procedure.

  • Link your bank account to Square.
  • Set up manual or automatic transfers
  • If you select manual, you will need to enter the amount to transfer and the bank details.

The following are some of the best money transfer options you can utilize to transfer money to a bank account.

1) Standard next-business-day transfer

The Standard next-business-day transfer requires you to link your account and accept card payments. You need to set up your transfer schedule, and Square will transfer the funds within 36 hours or 1-2 business days after receiving a transaction.

2) Custom Close of Day Time

You can set a specific time when you want to receive all your payments as one. You can decide to receive your payments either in the evening when you have closed your business. It is called close of day time.

3) Square Checking

Square gives you a checking account that allows you to access your funds as soon as customers make their payments. The account comes with Square Debit Card that helps you to access your money with ease.

Like any other bank account, the account comes with an account and routing number to make you make inbound and outbound transfers. You can allow third parties to debit your Square Balance using ACH at no cost to make payments.

Again, you can transfer funds from your Square Checking account to another bank account via ACH transfer. ACH transfer is an appropriate way to transfer money from one bank to another with ease.

4) Instant transfers

You can easily use Square’s instant transfers to avail money to your account instantly. You can instantly transfer money to your linked bank account using your debit card instantly and anytime of the day on all days of the week for only a 1.5% fee per transfer. Instant transfers require you to;

  • Link a bank account and an eligible US Visa or MasterCard debit card to your Square account.
  • Have at least $25 in your Square Balance after processing fees.

You can start with a transfer limit of $2,000 to $10,000 per day. However, you can get a higher transfer limit as your business grows with Square.

5) Same-day transfer

The transfer is almost similar to instant transfers though you can transfer funds at the close of the day to your linked bank account for a fee of 1.5% per transfer. The funds will always appear in your account 15 minutes after closing your account.

You must have at least $1 in your account for the transfer to succeed, excluding Square fees. You can receive payments of up to $10,000 per transfer. If you have more than $10,000, Square will send the funds in batches.

6) Manual transfer

Square automatically transfers money to your linked bank account every night, from Sunday to Thursday. However, you can disable the automatic transfers and instead transfer the funds at the most appropriate time possible. Once you transfer money, the funds appear in the next business day at no cost. The process is simple, just as you can transfer money to someone else’s bank account using the routing and account numbers.

You need to note that any transfers you make after 8.30 pm PST will arrive at your bank the following business day. You can choose manual transfers as follows.

  • Move to Settings in your Square Dashboard online or Square Point of Sale app.
  • Hit on Balance.
  • Move to the Transfer Schedule section and select Manual.

Can you use Square without a bank account?

No, you cannot use Square without a bank account. Square requires you to add a transactional bank account to allow you to deposit and withdraw funds. 

However, if you have the Square Debit Card plus the Square Checking account, you do not need to add any bank account to your Square account. Remember that the Square checking account is an account like any other, and you can still use it like any bank account. You can send money with a checking account number instantly to other Square accounts.

Bottom line

Square is a payment platform that allows you to receive payments via the Point of Sale or over the app. You can open a Square business account and receive instant payments from your clients without much hassle. Or you can transfer money from your Square app to a bank account either instantly at a fee or at the end of the day for free. You cannot use Square without a bank account.

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