Hi @Agent00747. I’m sorry about your situation. I have a strong suspicion what happened, based upon your post.
First, while Square can be used to accept donations, those are strictly limited to organizations and non-profits that are actually incorporated to receive donations — ie - charitable organizations that are recognized as such. Yes, during the pandemic, Square was allowed by the card issuing companies to accept donations for most businesses, but that time has long passed and the old rules were reinstated.
Here’s a link to one of Square’s documents about business types and activities that might be disallowed. I’m including a screen shot of the part that I suspect tripped you up. Of course, I’m only guessing but your description in your post gives me a strong reason to believe what I do. You accepted money from a customer that was not for goods or services rendered. According to Square’s contracts with Visa, Mastercard, etc, they are not allowed to do this ever, and neither are we. Most likely one of those card companies flagged the transaction and required Square to act or they would lose the ability to process cards for all of us.
For the record, this is not just a restriction on Square. Processing any credit cards for “donations” is subject to strict rules and is severely limited to bona fide charitable organization, not for-profit ones. Using credit cards to move money around for anything other than sale of goods or services is not allowed because it is basically doing a cash advance on that card without paying the higher cash advance fees. If the amount gets high enough, such transactions can even be flagged as money laundering, subject to criminal penalties.
Hi @Agent00747. I’m sorry about your situation. I have a strong suspicion what happened, based upon your post.
First, while Square can be used to accept donations, those are strictly limited to organizations and non-profits that are actually incorporated to receive donations — ie - charitable organizations that are recognized as such. Yes, during the pandemic, Square was allowed by the card issuing companies to accept donations for most businesses, but that time has long passed and the old rules were reinstated.
Here’s a link to one of Square’s documents about business types and activities that might be disallowed. I’m including a screen shot of the part that I suspect tripped you up. Of course, I’m only guessing but your description in your post gives me a strong reason to believe what I do. You accepted money from a customer that was not for goods or services rendered. According to Square’s contracts with Visa, Mastercard, etc, they are not allowed to do this ever, and neither are we. Most likely one of those card companies flagged the transaction and required Square to act or they would lose the ability to process cards for all of us.
For the record, this is not just a restriction on Square. Processing any credit cards for “donations” is subject to strict rules and is severely limited to bona fide charitable organization, not for-profit ones. Using credit cards to move money around for anything other than sale of goods or services is not allowed because it is basically doing a cash advance on that card without paying the higher cash advance fees. If the amount gets high enough, such transactions can even be flagged as money laundering, subject to criminal penalties.
