Why is it taking so long for me to get a new loan offer?

[Teecity71]

• I have been with Square for several years. I have also had 3 loans. Right now I'm close to 90% paying off the previous loan and I still don't have a new loan offer. The unpredictability is not good. With my previous loans I received a new loan offers after paying 75% of the loan. I was 100% expecting the samething on this current loan. I made promises to some of my clients about new services I would offer in September because I figured I would have received a new loan offer by this time. If Square is going to offer loans, they must have a system in place where the loans have some sense of predictable means. If all my criteria are green and in good standing and I have paid down, the current loan by 75% like the website says I should have received a new loan off at this point. When I call or email I get the same old generic response.  They say basically even though all of the criteria is in the green that still doesn't guarantee a new loan offer and they fail to tell us what does guarantee a new loan offer. They also says they have an algorithm that determines who gets loans and when. I wish I had known this before I accepted the first loan. The system by which Square dole out there loans is suspect to me. First of all they are technically not loans so Square doesn't have to abide by any state or federal regulations that governs equal opportunity. They are technically cash advances and not loans and that's what allow them to respond with the algorithm determines loans. If Square are going to continue to give loans I would suggest they set clear criteria by which someone would be approved. The process needs to be transparent and predictable. I hate to say it but if they continue to operate like they currently are they are setting themselves up for a class-action law suit. People need to know the process is fair

[Minion · Accepted solution]

Hi @Teecity71 

I want to start off by saying I am a seller just like you, and a majority of sellers here have been or are in the same situation as yourself when it comes to working capital and trying to break down the great Square Loan Algorithm.  I have said this time and time again, that I truly think that square needs to get rid of the "metrics" section and to be quite honest, not offer any new loan or become even eligible for a new loan until the previous one is 100% paid back.  This would elevate so much false hope.  Times and the economy are ever changing, so when one loan is offered at 60% and the next one is offered at 85% it really just becomes a guessing game of when the next one will fall.  But when sellers look at the metrics and everything is up and positive and no new offer in sight it surely does leave a sour feeling with you toward Square.  Many companies use an algorithm I assume similar to Square, however these other companies DO NOT offer any "insight metrics" towards your next loan opportunity.  

Below is a quote of the article you are referring to.  A seller "in general" must have at least 75% paid off. ( We have seen a few sellers with lower, but far and few between).  Even then it states that new offers are not the same across the board as old offers.  

Offers are not guaranteed and we are unable to predict when your business may receive another offer. New offers are not automatically extended when a certain percentage of an existing loan is repaid, but your business may become eligible for a new offer when your existing plan is closer to being repaid. In general, sellers repay at least 3/4th of their loan before receiving another offer. Loan offer details, as well as the timing of eligibility, may differ from your current Square loan.

To me those are the two most important lines of that whole paragraph, everything else is just filler. 

With you being at 90% paid off, I surely hope and would honestly assume that you should be seeing an offer any time as long as you keep processing sales via Square.  And to look at it this way, if/when you do get an offer, more of that loan can be used for your expanding vs paying off the previous loan.  

[Denisemcam24]

Curious if you ever received an offer?

[Adalynn]

Hi @malikmuneebhass !

We appreciate you taking the time to post!

Thanks for providing your feedback. There are many factors that affect loan eligibility, but the factors listed on the eligibility page are key factors we consider to help you understand our process.

There’s no additional information we can share at this time, and we can’t go into further specifics about program requirements because the criteria we use is proprietary.

Please know that we’re constantly working to improve our products and services based on the feedback we receive from customers.

If you have any other questions, please feel free to contact us directly!

I hope you have a great day 😊