Square Refiles Application for US Banking License

Square had withdrawn its initial application to create a deposit-taking bank in July.

Square Inc., a payments company, founded and run by Twitter CEO Jack Dorsey, is reportedly refiling its application for a bank license in the United States. The banking license was part of the firm’s push to grow into a financial institution that could compete with established lenders.

The San Francisco-based company had applied with state regulators in Utah and the US Federal Deposit Insurance Corp in September 2017 for a bank charter so that it could offer deposit accounts. The move immediately sparked immense controversy as it marks the first entrance of a cryptocurrency-friendly firm into traditional banking.

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Though Square had withdrawn its application to create a deposit-taking bank later in July, the payments processor said it intends to apply again in the future.

“Square Capital is uniquely positioned to build a bridge between the financial system and the underserved, creating access for small businesses to both capital and the economy. We will continue to work closely with the FDIC and Utah DFI as they review our applications for Square Financial Services,” Jacqueline Reses, Square Capital Lead said today.

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Growing Crypto Popularity

Earlier in June, Square was granted a so-called BitLicense by the New York State Department of Financial Services (NYDFS), becoming only the ninth such firm to win approval to operate in the state. It now legally operates as a money transmitter and digital currency exchange.

The news follows other, similar stories of progress for Bitcoin companies in the US, though cryptocurrency regulation still happens largely on a state-by-state basis.

San Francisco-based Square had jumped on the cryptocurrency bandwagon back in January when it rolled out Bitcoin trading to its Cash App customers.

Square founder and CEO Jack Dorsey has repeatedly shared his enthusiasm for digital currencies, saying it provides an “opportunity to get more people [to] access to the financial system.” He also thinks bitcoin is a transformational technology and will be the world’s single currency in 10 years.

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