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Can I use Square to make a purchase from my own business?

I have Square for customers making purchases from me. Can I use Square to make a purchase?

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That's a good question @mslavender -

You can definitely accept card payments from your customers for the sale of genuine goods or services. As the owner of the business, you won't be able to use a payment card with your own Square Point of Sale account. Additionally, it is not possible to accept payments from family members. For more information, please refer to our Terms of Service

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Best Answer

That's a good question @mslavender -

You can definitely accept card payments from your customers for the sale of genuine goods or services. As the owner of the business, you won't be able to use a payment card with your own Square Point of Sale account. Additionally, it is not possible to accept payments from family members. For more information, please refer to our Terms of Service

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Russell, I've looked all through legal and terms & conditions and I can find no place where you are prohibited from making a purcase of a physical product from your own business with your own credit card.
Further I've contacted Visa, Mastercard, Wells Fargo, M & T Bank (my bank) and various others to find out if this is a 'normal' practice.
The most I've been told is that banks dont want you to swipe your own card as a way of doing a cash advance (after all they get a higher interest on cash advances!) - but nowhere would it be prohibited as long as its a real transaction. 
Ive been a Visa Merchant for almost 40 years btw and I got blindslided by this just recently!

 

Help please!

 

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Super Seller

I would say paragraph 22 is what is the reason to deny payment.  Selling something to your self and using a credit card is seen as making a cash advance at a low rate.  Swiping your own card has been a violation of terms of service basically since Credit card processors have started.

 

While this link is not an official stance it has many people pointing out why it shouldn't be done. https://www.quora.com/Are-merchants-allowed-to-swipe-their-personal-credit-card-in-their-POS-machine...

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I read paragraph 22.

--snip--

22. Restricted Use

You will not act as a payment facilitator or otherwise resell the Payment Services to any third party. You will not use the Payment Services to handle, process or transmit funds for any third party. You also may not use the Payment Services to process cash advances.

--snip--

 

But this is not a cash advance.  store buys something nice like a macbook.  I want said macbook. my company does me an invoice for macbook that I pay with my credit card.  This has been permissable with visa/mc/bank forever as far as I know (and I said I've been a visa/mc merchant for over 40 years and have NEVER IN ALL THAT TIME HAD AN ISSUE WITH THEM!)

As I said the prohibition on getting a cash advance is different (IT INVOLVES NO PHYSICAL PURCHASE) and the reason banks dont like it is they want to get a higher interest rate in that case.  why would square care???  why SHOULD square care??

Paragraph 22 outlaws cash advances.  But this is not what is happening. 
From wikipedia (fount of all knowledge)

---

A cash advance is a service provided by most credit card and charge card issuers. The service allows cardholders to withdraw cash, either through an ATM or over the counter at a bank or other financial agency, up to a certain limit. For a credit card, this will be the credit limit (or some percentage of it).

---

There was NO CASH INVOLVED.  I took home a macbook.  No cash was withdrawn in any way.  My store paid for the macbook and I paid my store.  NO CASH INVOLVED AT ANY POINT.


Now if I had said 'let me run my card and you pay me $800 in cash' THATS a cash advance. 

If I said 'Russell come by my store I'll let you process an $800 charge and give you $790' thats a cash advance and factoring as well (The $10)  which is a further violation. But here NO CASH EVER CHANGED HANDS.  NO CASH = NO CASH ADVANCE

So I'm asking again - politely as I can - what is the violation?

 

 Any other thoughts??

 

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Thanks for replying btw.  The quora link is of course the general 'processors may not like it'. I spoke to Wells fargo about what they thought on this activity on a merchant account with them -  buying a physical item from your own store and I was told they would not have a problem with it.  The security system might flag the transaction (since you are the name on the card and the name on the store) and they might ask for explanation.  But physical purchase is a permissable use,  Its awarding yourself a cash advance and avoiding the higher cash advance rates they wish to discourage!

 

I have sought - in vain - for a 'you are not allowed to use your own card in your own square reader' anywhere.

 

THAT would make it clear.  maybe unreasonable - but clear!

 

There is a LONG list of prohibited activities. I had no idea you can using a square reader in a bankruptcy lawer business.  Or in a business welling adult items.  or in a business selling occult items. or in a business doing credit counselling or a business doing automated fuel dispensing (go figure?)

I've searched high and low.  where have I missed it?

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sorry typo you CANT use a square reader for any of the proscribed businesses!

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Super Seller

That could be but let's say you "buy" a pen from your store at $1,000, technically you are buying a pen buy really you are getting a cash advance of $999.75.  There are so many ways this can be abused by an unscrupulous vendor, or someone in a tight financial situation to get by "one more week", or even as a way to scam your credit card out of paying it by saying it wasn't your purchase or it was stolen (this would be a bit harder as it is your store ;-), or simply charging your card to the max and getting the cash and then declaring bankruptcy, or "buying" the item only to let it be returned for cash.

 

The item simply represents a Cash value, which is declared by setting a price.

 

Also presumably your store makes a profit on selling items, so if you sold your self an expensive painting or item with a large markup you are now your business is making money by processing your own card.  That profit will be deposited into your account where it can then be withdrawn as cash also.

 

I would say to get your best answer to call in on Monday and see what they can explain.  But as for me personally, I completely see why you shouldn't swipe your own credit card.

 

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Buying a 0.25 pen for $1000 would be a sham transacrion just as if YOU came by my shop and paid me $1000 for a .25 pen on YOUR card that would equally be a sham transaction (which oddly square would permit thought THATS absolutely a violation of the merchant agreement on any normal merchant account)

But thats not what happened it was an absloutly legitimate purchase at the correct price!

And I was NOT permitted to call in to discuss the transaction (i was told "phone support is not available for this account" by the website though i see square advertising live phone support for All customers!) and though i asked for a phone number to call i was told via email that "no phone call would help"

 

Why wont square give us a chance to explain a transaction and demonstrate it is NOT a sham?

 

Oddly i COULD have taken a cash advance off a card and paid my store in cash but as i said ive been a visa merchant for almost 40 years it NEVER crossed my mind that this would be an issue with square or that i would be denied any chance to explain having done so

 

Honestly i expected better treatment my them

 

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Hi @Cdbsystems - I'm sorry about this, but our Terms of Service and the guidelines set by the credit card networks are not up for debate or negotiation (I also want to point out that paying yourself is usually a violation of your credit card agreement as a card holder). 

I want to bring your attention to our Community Etiquette Guidelines - posts made to the community should be able to be answered by other sellers and be respectful of everyone using the community. Your question has been answered and your additional posts are just not productive. 

Please feel free to follow up with our Account Services team by email if you have any further questions or comments related to paying yourself by credit card.

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Russell, the question was not about paying yourself by credit card. It is about making a legitimate purchase of inventory/goods that are for sale. Where the owner is making a purchase of some of those goods for personal use. Just as any other customer does.

 

I find it hard to believe that the owner of a grocery store or any other retail establishment is prohibited from purchasing merchandise from his own business using a credit or debit card.

 

I also am unable to locate the prohibition in the terms of service. Would you please supply the section where it is discussed.

 

Thanks for your time.

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@Russell Square does NOT prohibit their clients from using their own personal credit cards to transfer money into their own bank accounts. Also, credit card companies do not prohibit this type of transaction either. I have read their terms and conditions and it does not prohibit it.

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I'm intrigued by the repeated decision to not say where, specifically, this is addressed in the terms of service.  Cut and paste is also an option.  I want to read the language.  

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If you could point to the specific area of the TOS that says this it would be appreciated. I've read it top to bottom and cannot find a reference to this. 

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I am new to square and have a question. I have a corporation credit card (with my name on it) that was given to be when employed, to make payments or buy equipment, etc. Am I able to swipe the company cc, even if it has my name on it? 

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Hey there @arloher84 - welcome to Square! 

You won't be able to sell to yourself using Square Point of Sale. See my answer to another seller above. 😉

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Russell, 

 

Where in the Terms of Service is the prohibition on sales to Family Members? I cannot find any information other than the account notification I received today. The Terms of Service make no mention of sales to Family Members. What gives?

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Yes you can! Just make sure that you request a Square card. You can then use that card just like a credit card. You do not have to have your funds transferred to your bank account. When someone pays you via Square, you can keep that money in your square balance so you can use your square card to make payments just like a credit card.

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Exactly. Square allows “add money” from your bank account balance to your Square account balance for use with your Sqaure card. This is THE exact equivalent of using your OWN debit card OR credit card (funds that you have 100% FULL UNDISPUTED ENTITLEMENT TO) to swipe into your Square account. No difference except that Square gets a % of you swiping your card rather than adding money from your bank account which is attached to your debit card. There is clearly a PERSONAL reason for Square behaving this way; because it is not legal whatsoever (yes, I AM qualified to have a legal discussion), and their stance would not hold up under the test of law in a court. Square also blocks crypto purchases with Square cards. However, as everyone knows, Square has made THE largest Bitcoin purchases (at least twice now) among all the tech companies. Square is amazing. But these behaviors by Square EMPLOYEES pursuant to [internal] “policies” we’re discussing, along with this “Russell’s” abhorrent way of speaking to someone who is simply trying to get a clear answer, is something that must be addressed by those that SQUARE views as authority. Because clearly, Square is not interested in simply behaving in a way that is ethically correct without “pressure” to do so.

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