Square Payment Services: A Serious Warning for Business OwnersI am deeply disappointed with my experience using Square as a payment processor. After completing my first transaction through their platform, they deactivated my account and withheld $1,995.00 (minus their $68.58 processing fee) for 90 days. The reason provided was that a customer-authorized tip of $255 was deemed “unusual.”This reasoning is both unreasonable and uninformed. In San Francisco, a $255 tip is far from uncommon—it’s a drop in the bucket, especially given the high cost of living and frequent generosity of customers in this region. Square’s handling of this transaction shows a lack of understanding of typical business practices in metropolitan areas like San Francisco.Square’s actions raise significant ethical concerns. Their decision to allow the transaction, deduct their fee, and subsequently hold my funds suggests a deliberate strategy that disadvantages small business owners. Such practices enable Square to retain funds as assets on their books or for potential investment purposes—practices that should not come at the expense of legitimate business operations.At no point during onboarding or in their terms of service was I made aware that legitimate transactions could result in account deactivation or prolonged withholding of funds. If Square had concerns about my account, they had an obligation to address those concerns before approving the transaction and collecting their fee.I did not agree to become an accommodation party for Square with my earnings, nor should any business owner be subjected to such treatment. Their actions have caused undue financial hardship and disrupted my ability to operate my business effectively.To Others Facing Similar IssuesIf you are experiencing similar practices, I strongly recommend taking action: 1. File a complaint with the Consumer Financial Protection Bureau (CFPB) to report unfair business practices. 2. Submit a formal complaint to the Federal Trade Commission (FTC) to ensure these behaviors are investigated. 3. Contact your State Attorney General’s Office to request an investigation into Square’s handling of withheld funds.Square’s lack of transparency, questionable business practices, and insufficient customer support make them an unreliable choice for payment processing. This was my first and last time using their services. I urge other business owners to carefully research payment platforms that prioritize transparency, fairness, and professionalism.
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