Square's gross payment volume tumbled by 15% year-over-year due to COVID-19’s impact, but revenue jumped as online selling rose, Cash App doubled in users and Square enabled almost $900 million in PPP loans.
Brick-and-mortar merchants that have shifted to online have changed their risk profile, causing conflicts with the fintechs like Square that handle their payments. And that could be an opportunity for banks.
When the coronavirus pandemic began, Square pushed hard to get a bigger share of merchants' online sales and consumers' stimulus spending — and even received its long-desired bank license — but found that this wasn't enough to offset the effects of the crisis.
Square Capital and other online lenders joined the Paycheck Protection Program just before it ran out of money. Now they’re ready and waiting for Congress to reload funds that could be better aimed at the smallest companies.
PayPal, Intuit QuickBooks Capital and Square Capital have been named direct lenders in the Paycheck Protection Program, and more await the go-ahead. They could be crucial to reaching the smallest firms trying to survive the economic toll of the coronavirus pandemic.
It was less than three months ago, though it seems like a lifetime. Mastercard CEO Ajay Banga welcomed progress in the trade dispute between the U.S. and China, but with a caveat. The good news wouldn't last if the coronavirus became a pandemic.
Online platforms and apps can be utilized to quickly support small businesses and consumers facing unexpected financial hardship.