Square’s Cash App which is a free P2P service, also has an attached debit card allowing consumers to spend the money they receive through their P2P transactions. And adoption is way up. Motley Fool commented on the topic in their review of Square’s second quarter financial results:
Square introduced the Cash Card — a debit card product attached to its Cash App — about one year ago. As of June, users are spending at a $3 billion run rate, a threefold increase since December. Cash Card has been an undoubted success for Square. In the company’s second-quarter earnings call, management called out the product as one of the main drivers of its subscription and services revenue.
Square is also moving beyond P2P transactions and offering more financial services for unbanked and underbanked, making Cash Card look more like a typical general purpose reloadable prepaid card:
Square has taken steps to make the Cash App and Cash Card a more integral part of its product ecosystem. It integrated Cash App with Caviar — its food delivery business — to enable its couriers to receive payment instantly. With the Cash Card, they can spend that money instantly too (paying for gasoline, for instance), so there’s never a cash flow problem. The Cash App also allows employees to receive payroll deposits from Square merchants.
Next up is the option for Square Cash Card users to earn rewards:
In May, Square rolled out Cash Boosts, a reward program that offers cash back on Cash Card purchases made at certain merchants. Boosts are designed to encourage users to use the Cash Card as a primary spending tool. CEO Jack Dorsey compared Boosts to credit card rewards programs, which give customers points or cash back every time they use their card in order to encourage more use.
Square’s solution is far smaller than similar products offered through other prepaid providers, but their ability to tie together both the issuing and merchant communities together will help Square to capture more market share.