The news: Square Loans will extend credit to 50% more Square merchants than were previously eligible for loans, per a press release.

Square will use its proprietary underwriting model to determine loan eligibility.

How we got here: Lending has been a growth engine for Block’s Square and Cash App, per Q4 2025 earnings.

• Cash App Borrow’s origination volume jumped 233% YoY.
• Square Loans’ origination volume spiked 23% YoY.
• And Cash App is selling its alternative credit scores to other companies to assess creditworthiness beyond FICO scoring.

As consumer sentiment falls—The University of Michigan’s Index of Consumer Sentiment dropped 6% MoM—and spending flattens under tariff and wartime uncertainty, payment providers need to turn to other sources to drive volume growth—particularly commercial and corporate entities. 

• American Express launched the Graphite commercial card to target this sector and virtual cards for SAP’s expense management.
• Visa debuted SMB platform Visa and Main.
• And Affirm partnered with QuickBooks to bring buy now, pay later (BNPL) to SMB invoicing.

Why this matters: SMBs are hungry for cash-flow assistance, and Square Loans’ flexible repayment scheme could make it a compelling choice for small businesses’ loyalty: 54.9% of SMBs want payment due dates aligned to their business’s cash flow or receivables, per a PYMNTS Intelligence report.

Implications for payment providers: As more providers develop products targeting SMBs, providers with dual-sided networks should look into creative ways for business owners to make repayments on loans, like percentages of daily sales to track repayment with cash flows rather than monthly statement cycles.