Square Loans: how it works and what it costs
An invitation-only flat-fee loan for Square sellers, repaid automatically from a slice of daily card sales.
How it works
Square Loans is the odd one out in this directory because you cannot apply for it. It is an invitation-only programme for eligible Square sellers. Square's systems watch your card sales, and if your business qualifies, Square makes you an offer. Square is blunt about this: offers are not guaranteed, and it says it cannot manually generate or predict offers even where all the eligibility factors are met. There is no form to fill in and nobody to ring.
Two things make an offer more likely, according to Square's help pages. First, processing at least £10,000 a year through Square. Second, business structure. Square says you must be a Square customer with a company or corporation structure. That wording points to incorporated businesses, so sole traders appear to be excluded.
If an offer arrives and you accept it, the money can land as soon as the next business day. There is no interest rate. Square charges one flat fee, fixed at the start, and says that is the only cost. You then owe the loan amount plus the fee, and that total does not change later.
Repayment is automatic. Square takes a slice of your daily card sales, typically 17.25%, until the debt is cleared. Busy days repay more, quiet days repay less, and Square says you will never make payments when you are closed. There are two backstops. At least 1/18th of the original loan balance must be repaid every 60 days, whatever your takings. And the whole loan must be repaid within 18 months.
Here is what that looks like with Square's own typical numbers. Borrow £10,000, pay a fee of £1,325, and you owe £11,325 in total. A seller taking £500 a day through Square would hand over about £86 a day at the typical 17.25% rate, and clear the loan in a little over four months. The fee stays £1,325 whether repayment takes four months or the full eighteen, which is why the speed of your sales, not the fee, decides your true yearly cost.
Want another one? In general, Square says sellers must repay at least three quarters of a loan before receiving a fresh offer, and even then nothing is promised. One more thing to keep straight: Square also runs a separate product in the UK called Square Cash Advance. Same company, different product, different terms. This page covers Square Loans only.
What it really costs
Square's headline is bold: "0% business loan interest rate - just one flat fee", and "You'll never pay any interest or other fees, just the loan fee". Both statements are accurate. Neither means the loan is cheap. Square publishes an example, quoted exactly: "Typical loan offers are £10,000 with a fee of £1,325, or 18.90% APR".
In plain English: borrow £10,000, repay £11,325. The fee is 13.25% of what you borrow, set on day one, and it never grows.
So why does Square quote 18.90% APR rather than 13.25%? Because you repay daily from your card sales, you do not keep the full £10,000 for the full term. On average you are borrowing a shrinking balance, which makes that fixed fee steeper as a yearly rate than it first looks. And the faster your sales clear the loan, the higher the true yearly rate climbs. A flat fee repaid in four months costs the same pounds as one repaid in eighteen, but as a yearly rate it is several times more expensive.
There are no other numbers to hunt for. No interest meter, and Square says no fees beyond the loan fee. Just remember the two floors: 1/18th of the original balance is due every 60 days regardless of sales, and everything must be repaid within 18 months.
Check the current figuresLenders change pricing without notice. The representative example on Square Loans's own site is the number that counts.
Who can apply
- Invitation-only. There is no application, and Square says it cannot manually generate or predict offers even where all eligibility factors are met
- Must be a Square customer. Square's help pages point to a company or corporation business structure, so sole traders appear excluded
- Processing at least £10,000 a year through Square makes an offer more likely, at the time of checking
- For a repeat loan, sellers generally need to have repaid at least three quarters of the current one first
Good for
- Limited companies with steady card takings already running through Square
- Sellers who want repayments that flex with daily trade rather than a fixed monthly bill
- Fast money once an offer exists, with funds as soon as the next business day
- People who prefer one fixed total to repay over a running interest meter
Watch out for
- You cannot apply. If your funding plan depends on an offer turning up, you do not have a funding plan
- 0% interest is framing, not a price. Square's own typical example works out at 18.90% APR, and quick repayment pushes the true yearly cost higher still
- The no-payments-when-closed promise has a floor: 1/18th of the original loan is still due every 60 days, quiet spell or not
- Square Loans is not regulated by the FCA, so the protections that come with regulated credit do not apply
- Sole traders appear to be shut out. Square's help pages point to incorporated businesses only
How Square Loans compares
The obvious problem with Square Loans is that you cannot go and get one. If the repay-from-daily-sales shape appeals but you want a product you can actually apply for, our YouLend page covers the same fixed-fee, repay-from-sales shape of funding, and our card terminal advances page covers similar advances for sellers on other terminals. If a fixed monthly repayment suits you better than a daily slice of takings, a conventional term loan is the usual alternative, and our Funding Circle page covers one well-known route. A very different shape of borrowing, but a far more predictable one.
Put Square Loans side by side with another lender →
Common questions
Can I apply for a Square loan?
No. Square Loans is invitation-only, and Square says it cannot manually generate or predict offers even where all eligibility factors are met. If your business qualifies, an offer appears. There is no application form and nobody to ring.
Can sole traders get a Square loan?
It appears not, at the time of checking. Square's help pages say you must be a Square customer with a company or corporation business structure, which points to incorporated businesses. Square does run a separate Square Cash Advance product in the UK, which has its own rules.
How fast does the money arrive?
Quickly, once an offer exists. Square says funds can arrive as soon as the next business day. The slow part is waiting for an offer, and there is no way to hurry that up.
Is the 0% interest rate real?
There is genuinely no interest, but there is one flat fee, so the borrowing is not free. Square's typical example is £10,000 with a fee of £1,325, which Square itself quotes as 18.90% APR. The honest measures of cost are the APR and the fee in pounds, not the 0%.
Does repaying early save money?
No. The fee is flat and fixed when the loan starts, so the pounds you repay stay the same however fast the loan clears. Quick repayment actually makes the loan more expensive as a yearly rate, because you hold the money for less time. Full repayment is required within 18 months regardless.
When can I get another Square loan?
In general, Square says sellers must repay at least three quarters of their existing loan before receiving another offer. That is a general rule, not a guarantee, and a new offer may not come at all.
Regulation and status
Square's own wording, at the time of checking: "Square Loans is not regulated by the Financial Conduct Authority (FCA). All loans are issued by Squareup Europe Ltd". The protections that come with FCA-regulated credit do not apply here.
Square runs an affiliate programme, but Square Loans is not a commissionable product, so FundSpeed earns nothing from this page. Paid or not, that never changes what we write. Facts checked on 7 September 2026 against the sources below. Spotted a change? Tell us and we will fix it.