What Square Savings Is and Who Can Open One
Square Savings is a cash management account offered through Square, the payment processing platform. It is not a traditional bank account—it sits alongside your Square business account and holds money from your sales, transfers, or direct deposits. The account is held at Lincoln Savings Bank, a federally chartered bank, so deposits are insured up to $250,000 by the FDIC.
You need an active Square seller account to open a savings account. This means you must have already signed up for Square's payment processing service, even if you are not actively processing card payments. Square Savings is available to business owners in all 50 states, though some account features may vary by state.
There is no monthly fee to hold a Square Savings account, and no minimum balance requirement. You earn interest on the balance, though the rate changes based on market conditions and is set by Lincoln Savings Bank. Square does not charge you to move money in or out.
Key Takeaways
- Square Savings requires an active Square seller account and is FDIC-insured up to $250,000 through Lincoln Savings Bank.
- You open a savings account directly in the Square Dashboard under the Cash section, with no separate application or approval process.
- Money moves between your Square account and savings account instantly within the dashboard, but transfers to external banks take one to two business days.
- Interest accrues daily and is deposited monthly, though the rate is set by Lincoln Savings Bank and changes over time.
- You can withdraw all your money at any time with no penalty, and the account closes if you close your Square seller account.
Opening a Square Savings Account in the Dashboard
Log into your Square Dashboard on a computer or the Square app. Navigate to the Cash section, usually found in the left menu. Look for the option labeled "Savings" or "Open a Savings Account"—the exact wording depends on your version of the dashboard.
Click to open the savings account. Square will ask you to confirm your business information and review the terms. You do not need to submit additional documents or wait for approval. The account opens immediately, and you will see a savings balance of $0 in your dashboard.
Once the account is open, you can begin moving money into it. Square will assign you a routing number and account number specific to your savings account, which you can use if you want to set up automatic transfers from another bank or payroll system.
Moving Money Into Your Savings Account
The easiest way to fund your savings account is to transfer money directly from your Square balance. In the Cash section of your dashboard, select "Transfer to Savings" and enter the amount. The transfer happens instantly—the money leaves your Square balance and appears in your savings account right away.
You can also set up automatic transfers. Square allows you to schedule recurring transfers on a daily, weekly, or monthly basis. This is useful if you want to move a fixed amount each week without having to log in manually. Set up automatic transfers in the Savings settings within your dashboard.
If you want to deposit money from a source outside Square—such as a business checking account or payroll—you can use the routing and account number Square provides. Transfers from external banks typically take one to two business days to appear in your savings account.
Withdrawing Money and Moving It Back Out
To move money from savings back to your Square balance, go to the Cash section and select "Transfer from Savings." Enter the amount and confirm. The money returns to your Square balance instantly and is available for payouts or other uses.
If you want to move money from your savings account to an external bank account, you will need to transfer it to your Square balance first, then initiate a payout to your bank. Payouts from Square to your connected bank account take one to two business days, depending on your bank.
There is no limit on how often you can withdraw or transfer money, and no penalty for doing so. You can close your savings account at any time by transferring the full balance out and then closing the account in your settings. If you close your Square seller account, your savings account closes automatically.
How Interest Works on Your Savings Balance
Square Savings earns interest, which accrues daily based on your daily balance. The interest rate is set by Lincoln Savings Bank and is not set by Square. The rate changes periodically and is typically higher than a standard savings account at many online banks, though you should check the current rate before opening the account.
Interest is deposited into your savings account once per month, usually on the same date each month. You will see the deposit reflected in your balance and in your transaction history. The interest is taxable income, and Square will send you a 1099-INT form at the end of the year if you earned $10 or more in interest.
Because the rate is variable, it can go up or down. Square will notify you of any rate changes through your dashboard or email. You can check your current rate and historical interest earned in the Savings section of your dashboard at any time.
Security and FDIC Protection
Your Square Savings account is held at Lincoln Savings Bank, which is a federally chartered bank. This means your deposits are protected by FDIC insurance up to $250,000 per depositor, per bank. If you have multiple accounts at Lincoln Savings Bank under your name, the $250,000 limit applies across all of them combined.
Access to your savings account is controlled through your Square Dashboard login. Square uses encryption and multi-factor authentication to protect your account. If you enable two-factor authentication on your Square account, it also protects your savings account.
Square does not have access to your savings account balance for any purpose other than holding and managing the funds. Your money is not used by Square for lending or other business purposes. If Square goes out of business, your savings account remains at Lincoln Savings Bank and is unaffected.
When Square Savings May Not Be the Right Choice
Square Savings works best if you already use Square for payment processing and want a simple way to set aside money without switching banks. If you do not have a Square seller account, you cannot open a savings account, and you would need to use a traditional bank or online savings account instead.
If you need to move large amounts of money frequently between multiple accounts, a traditional business bank account may be more convenient. Square Savings is designed for holding and growing money, not for managing complex cash flow across many vendors or accounts.
If you need features like checks, debit cards, or business credit lines, Square Savings does not offer these. It is a savings tool only. For those features, you would use a separate business bank account alongside your Square account.
Frequently Asked Questions
Can I use Square Savings if I do not process card payments?
You need an active Square seller account, but you do not have to process card payments regularly. As long as your account is open and in good standing, you can use the savings account to hold and grow money. If you close your seller account, the savings account closes too.
What happens to my savings if Square shuts down?
Your savings account is held at Lincoln Savings Bank, not by Square. If Square closes, your account remains at the bank and is protected by FDIC insurance. You would receive instructions from Lincoln Savings Bank on how to access your account directly.
Can I link my Square Savings account to my personal bank account?
Yes. Square provides a routing number and account number for your savings account. You can use these to set up transfers from your personal or business bank account. Transfers from external banks take one to two business days to appear.
Is there a limit to how much I can save?
FDIC insurance covers up to $250,000. You can hold more than that, but only the first $250,000 is insured. If you have multiple accounts at Lincoln Savings Bank, the limit applies across all of them combined.
Do I pay taxes on the interest I earn?
Yes. Interest earned on your savings account is taxable income. Square sends a 1099-INT form at the end of the year if you earned $10 or more. You report this interest on your tax return.