@itsmrglass wrote:
Our business is a small Black-owned establishment that began as a barbershop and transitioned into a barber school. The growth we have experienced is primarily due to the invaluable support we have received from Square loan. To date, we have obtained two loans and are currently awaiting our third. The Square platform is now indispensable for businesses like ours following the Covid crisis. Conventional loan options often passed over our applications, but Square's features have given us the means to validate every transaction, establish legitimacy and keep the business thriving. I'm grateful for these benefits.
However, business owners who have diligently made repayments towards their Square loans need more certainty. It can be daunting not to have guaranteed access to loans after demonstrating solid payment history. Why not focus more on nurturing small businesses and providing them with an assurance of future capital possibilities instead of the cookie-cutter responses leaving devout business owners in the dark, waiting to become " eligible"?
Thank you
Mr. Glass
Hi @itsmrglass
I get where you are coming from. 100% After a structure fire in 2017, I was pretty much forced to file a BK7 (had i done some better research, I wouldn't have gone with a Chapter 7, but that's history now). Having to climb back out of the mud so to speak and build credit an my business all over again, while having a BK show up on my personal credit report has had its challenges none the less. Like you, Square was helpful in providing capital when needed. Making it priority to make sure payments are on time, and CC sales are being process, just to have the algorithm say I'm ineligible. It's not the best feeling, especially when you do everything right.
I think a problem with that is they don't have underwriters that can manually review accounts. (I have no idea on this, just an educated guess). So it is sort of out of their hands unfortunately. I do wish though that Square would tweak their algorithm to look at the business as a whole, and not just CC sales, but also cash and check.
However, many banks and institutions not just Square have tightened and re wrote algorithm and any underwriters are being more conservative since COVID and the current state of the economy.
With all that being said, I do want to offer some additional advice or avenues that may help you out. There is a decent deal of information in this thread here. Some of it is slightly out dated, but overall it is still very usefull if you are looking to build business credit.
If you are a current Amex account holder, (credit card, banking etc) you can login and see if you pre-qualify for their Business Blueprint (formerly Kabbage) without risking a hard pull to your current credit report. Monthly payments , with a fixed % based on the loan.
Quickbooks also offers working capital for current customers , but with weekly payments.
Out of the 3 of these, I will say they are all pretty similar each one has its flaws.
Square's doesn't "hurt" the bank account as much , as its taken from the daily cc sale, so to me its one of those "out of sight, out of mind". The con being the uncertainty of when another loan will generate (If at all).
Amex BluePrint- Fairly competitive rates, however the "LOC" can fluctuate every day based on your business, as well as your personal credit (even if it is a soft pull)
Quickboks Capital. They see the whole picture of your business, whish is a huge plus. The weekly payments, and they also have the uncertaintiy of receiving another loan once one is paid off, even if you did everything right.
Just wanted to share my experience with you and hope that maybe one of these options may be able to help you out. Feel free to reach out here or in a message if you have any further questions about business credit information.
Cheers
