Square’s big dreams for Cash App
Square (SQ) is busy building its Cash App platform into a bank account of the future. Speaking at Recode’s Code Commerce 2018 event recently, Square’s CFO, Sarah Friar, said the Cash App would begin to look more and more like a bank account, saying the company has explored developing the app into an investment and banking product of the future.
Friar made similar comments in an interview with Quartz in June.
Using Cash App to buy and sell stocks
As an investment product, Cash App users may in the future be able to use the app to invest in stocks, for example. Cash App users can already use the app to buy and sell Bitcoin for a profit. As a banking service, Cash App users may also be able to use the app for savings and checking account needs. Square has already introduced a debit function that lets Cash app users withdraw their balances from ATMs to spend offline.
Square’s Cash App competes with PayPal’s (PYPL) Venmo for customers. PayPal is also keen on developing Venmo into the go-to app for consumer financial services, and it’s recently begun issuing Venmo debit cards that let people use their Venmo balances to shop in stores.
Amazon (AMZN) has also explored creating a checking banking product in partnership with big banks such as JPMorgan Chase, according to the Wall Street Journal.
Revenue increased almost 50% at Square
In addition to processing payments for customers, Square, PayPal, and Amazon also extend loans to small businesses. In July, eBay (EBAY) tapped Square to extend small business loans to its sellers.
Square’s revenue rose 47.8% YoY (year-over-year) to $814.9 million in the second quarter. Revenue rose 43.6% YoY at online lender LendingClub (LC) in the second quarter.