Payment Processing Platform Square Announces Withdrawal of Banking License Application

Payment process platform Square announced on Thursday it has withdrawn its regulatory banking licensing application. According to Reuters, the company applied with the Federal Deposit Insurance Corp (FDIC) for a special “industrial loan company (ILC)” last year. If granted, the license would have allowed non-traditional financial firms (like Square) to collect government-insured deposits. Speaking about the withdrawal, a Square representative revealed to the media outlet:

“We have been engaged in constructive dialog with the FDIC, and our decision to withdraw and refile was a procedural step in the review process that will allow us to amend and strengthen some areas of our FDIC insurance application.”

The Square rep also reported its separate ILC application with the State of Utah Department of Financial Institutions currently remains active, noting:

“We continue to work closely with the FDIC and Utah DFI on our application.”

Square did not provide an anticipated time frame for reapplying for the license with the FDIC at this time. The news of Square’s regulatory banking license application withdrawal comes just a few weeks after the company revealed it secured a virtual currency license from the New York State Department of Financial Services office. As previously reported, Square reported it is fully launched with the ability to buy and sell bitcoin through its mobile Cash app earlier this year but was not able to offer the service in New York state.

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