Technology Stocks

Square Inc. (NYSE:SQ) Launches Square B2B Card That Enables Purchase Of Merchandise Using Square Account Balance

Square Inc. (NYSE:SQ) gained by 3.7% on the day the company launched their business-to-business debit card. In the last trading session, the stock increased by 0.74% to close the day at $72.28.

The reason for the gaining was the launch of the of their B2B square card that allows merchants to purchase with the money in their square accounts. The card will tap into markets dominated by traditional card companies to boost the company’s revenue.

The Square Card to boost revenue

The Square Card may not look like a new product in the market, but it has already impressed analysts. Since the launch of the card at the start of the year, it has seen Square’s stock grow by 36% even when the stock of other tech companies continues to struggle.

On Jan 24 analyst Dan Dolev of Nomura Instinet indicated that the card was already a hit and it was one stone killing several birds at ago. He stated that he foresees the card creating a $50 billion for the company in future.

The exciting B2B card

The card is exciting in various ways, and it provides small business with immediate cash flow. The money from merchants is instantly accessible for use through a debit card. The card has 2.75% cash back for customers on all purchases made at Square merchants.

The Square Card borrowed its design from the Cash Card that allows users to use their Cash App balance and it also had boosts in the form of discounts at mainstream outlets such as Chipotle and Starbucks for cardholders.

Similarly, the Square Card removes intermediaries since a bank does not issue it and it does not need a bank account as the funds get channeled from the business’s Square balance.

The card addresses the underpenetrated business-to-business market that is only 4% carded by reinforcing the system through incentivizing of sellers to trade with each other. Small and medium-sized businesses can view their sales records and purchasing activity from their card through their Square dashboard.

Most importantly about the launch of the card is the long term vision of Square which deepens their bank disintermediation.

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