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What You Need to Know About the Square Debit Card

Square offers a business debit card that connects to your Square balance.

What I Like​

When they say no fee, they mean NO fee. The Square Card is free to order and customize, and there are no annual or monthly fees. The card makes no charges to use any ATM and is accepted anywhere Mastercard is. In my experience, it's the perfect card to keep on hand in your register for managers and employees to use for petty cash.

The card spend is reported in a system that you and your team already have access to, your Square Dashboard. If your manager needs to check what an employee spent on an item for the store, the information is available in the Square app.

Some Caution Is Required​

While it is helpful to have on hand, there are a few important things to remember when using the Square Card.

Don't Bounce Your Payroll!​

If you're a regular Square user, you know that funds from Square transfer automatically to your bank account. Once you turn on the Square Card, this is no longer the case. Let me say that again: if you have the card turned on, funds will not automatically transfer. Money will no longer flow into your account until you send it manually. If you need that cash for payroll, you need to stay on top of bank transfers so that there are funds to pay your employees. To make those transfers, go to the dashboard page in Square.

The Reporting Will Confuse You and Your Bookkeeper​

Fees, loan payments, and other daily transactions reduce your balance. While the balance reflects these fees, there is no report that explains how the balance is adding up and what transactions are being taken into account. When you see a line on the all activity report here that says "Sales," note that it actually represents "Sales -- Fees -- Loan Payments -- Refunds -- Disputes." Additionally, Square's balance transaction reporting period did not match my sales reporting period, which can lead to confusion for you and your bookkeeper.

Example of a Square Card activity report showing transactions and balances

It's Hard to Book the Spend Transaction Because There Is No Automation​

There is a report on card spend found here, and it can be downloaded to a CSV file. However, there is no way to automate the entry of these expenses to your QuickBooks Online or Xero. So if you need to use this data in your bookkeeping, you would need to export it and manually enter it into QuickBooks.

How We Can Help​

As more businesses adopt the Square Card, more bookkeepers will need to handle these issues, which can waste a lot of time and money. Fortunately, we're here to help. Bookkeep can help iron out some of these wrinkles in the process. While Square won't show you fees, our service will book those fees daily to QuickBooks Online and Xero. We also book the loan payments for Square Capital and any other fees or adjustments to your balance.

Another tricky issue is the Card Spend tab in Square. This is a downloadable report intended to track your transaction history with the Square Card. We include a link to that report directly in the daily fees journal entry we post so you can quickly see if there is card spend to book without having to click several times to find it.

The Square Card is a perfect example of a technology innovation that aims to make running your business easier but can make accounting more challenging, time-intensive, and expensive. This is exactly where we come in to iron out these issues so you won't have to.