Small businesses that write checks to landlords, insurers, or suppliers every month just got a new option. Square announced on August 11 that sellers can now put those bills on the Square Credit Card and earn 3% cash back, even if the vendor on the other end has never touched a card reader.
The trick is Square’s expanded Bill Pay feature, which sits inside the Square Dashboard. When a seller pays a vendor who does not accept cards, Square routes the money as either an ACH direct deposit or a mailed check, whichever the vendor prefers. The seller sees a credit card charge; the vendor gets paid the way they always have.
How the rewards math works
The refreshed Square Credit Card, which runs on the American Express network, now pays unlimited 3% cash back on Bill Pay transactions and 1.5% on everything else. Rewards can be redeemed as a deposit into Square Savings, a statement credit, or free payment processing.
There is a fee for using a credit card to fund Bill Pay. Square says the 3% cash back is enough to cover that fee, though the company has not published the exact percentage. Square’s own support pages list a 2.9% surcharge for credit-card-funded Bill Pay transactions, which would make the net reward a thin but positive margin.
The card carries no annual fee, no late fees, no foreign transaction fees, and no personal guarantee.
What to watch before swiping
Andrea Raj, head of product for Square Banking, framed the pitch plainly. “Pay vendors on time, keep cash longer, and earn the right rewards for it, all in one place,” she said in Square’s press release.
That pitch lands differently depending on whether a business pays the balance in full each month. The 3% reward only pencils out if there is no carried balance racking up interest. Businesses that roll charges over could quickly see interest costs erase the cash-back advantage.
Bill Pay was previously available only to sellers who held a Square Checking account. It is now open to all Square sellers, covering rent, insurance, marketing, and supplier invoices. The move puts Square in direct competition with standalone bill-payment services like Melio and Plastiq, which charge similar fees but sit outside a seller’s payments ecosystem.
The feature is live now inside the Square Dashboard under Banking. Businesses considering it should run the numbers on their largest recurring bills, compare the 3% reward against any interest they would pay, and decide whether consolidating payments inside Square is worth the concentration risk of keeping more of their financial life on one platform.
