Two years ago Square, Jack Dorsey’s payments company, started offering merchants cash advances alongside point-of-sale solutions and analytics software. In the time since Square Capital has grown into a full-scale online lending operation, posting $208 million in loans last quarter. Today, Square said that total volume for Square Capital has surpassed $1 billion.
That is good news for Square investors, who have been looking for signs that the company can succeed with higher-margin products.
But the announcement also highlights the head start benefiting Square Capital competitors like Funding Circle and PayPal Working Capital, both of which are focused on small business lending. Funding Circle, for example, had lent over $2.5 billion as of July. That same month, PayPal passed the $2 billion mark.