While Cash App is mostly known for personal transactions, you can use Cash App For Business transactions by setting up a business account with a few simple clicks.
Square is one of the biggest names in small business credit card processing, but there is one part of Square’s ecosystem that flies below the radar when it comes to business transactions. We are talking about Cash App, the popular peer-to-peer transaction application and lite bitcoin trading platform.
In this article, we’ll look at how to set up a Cash App business account, how to use Cash App for business versus personal, and the application’s strengths and limitations.
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Can You Use Cash App For Business?
While Cash App is mostly known for personal transactions, you can use Cash App for business transactions.
You will need to create a business account to use Cash App for business transactions. You will then be able to accept transactions through the application. Note that if you are a Square customer using compatible hardware or software, it is possible to accept the Cash App as a payment method without a Cash App business profile. More on that later.
Note that, like Square’s other services, the Cash app has a list of prohibited businesses.
What Is A Cash App Business Account?
Simply put, a Cash App business account allows merchants to make sales through the Cash App, while remaining within good bounds of the terms of service and law. Cash App business account has the following features:
- The unique payment link and QR code can be used to initiate the transaction.
- Allows you to accept peer-to-peer (P2P) cash app payments
- There’s no limit to the amount you can get
- Allows you to accept payments through Visa, MasterCard, American Express and Discover networks
Cash App For Business VS Personal Accounts
For the most part, Cash App for Business and Cash App personal accounts work similarly. However, there are some major differences:
- Transaction fees are levied on receiving funds from the Cash App account. There is no personal account.
- There is no limit to the amount of money you can receive with a verified business account.
- You can be paid with a credit card, not any other Cash App account
You can have both a Cash App business account and a personal account at the same time, but each account requires a separate phone number.
Cash App For Business Fees
If you’re accustomed to peer-to-peer transaction apps being free, it can be a little disappointing to hear that Cash App for Business has transaction fees in addition to optional fees paid for quick bank deposits in a personal account. .
Here are the fees for Cash App business accounts:
- 2.75% per transaction
- 1.25% fee on instant deposit (minimum $0.25)
But wait, aren’t personal account transactions free?
Cash App for Business is less about getting unique features than about complying with your terms of service. More importantly, by 2022, services like Cash App are required to report commercial transactions of more than $600 in commercial payments annually to the IRS. You should expect more scrutiny of transactions going forward.
Cash App Business Account Limits
Given its origins in P2P transactions, Cash App was not envisioned as a high-volume transaction platform. To use the Cash App for more than just the occasional short sale, you’ll need to have a verified account. Boundaries work like this:
- $7,500 per week sending limit and $17,5000 per month with a verified account.
- There is no limit to the amount you can receive.
- $25,000 per week limit on cash out
- Unverified accounts can do $250 worth of transactions in a day and $1,000 within a 30-day period
You can access limits within the app by tapping on the account settings icon in the upper right corner, then tapping on Limits.
How To Make A Cash App Business Account
Cash App business account is very easy to create.
- Download the Cash App and create a personal account.
- Within the app, tap on the icon that looks like a person in the upper right corner. This will bring up your account information.
- The top sub menu should say “Personal”. Tap on it. You will get your personal details there. Scroll all the way down and you should see an option to change account type. Tap on it.
- If you are in the right place, you should see something like the screenshot below, which reveals the transaction fee. Tap on Change this account.
- If you haven’t done so already, you’ll want to link your bank account with your Cash app. You can do this by selecting the linked banks and following the instructions.
Note that you can verify your account before or after you convert your personal account to a business account.
The first time you try to exceed the limit for an unverified account, you will be asked to verify your account. You will then be asked to submit personal information, including your full name and Social Security number.
How To Set Up & Use Cash App For Business Transactions
You don’t need to do anything special to make Cash App ready for transactions.
Cash App works through payment links and QR codes, which means you and other Cash App users will be able to initiate a transaction by one party scanning the other’s QR code. If you don’t want to have your phone for each customer, you can print this code for them to scan.
The good news is that your customers don’t have to have the Cash app to pay you.
You can generate a payment link (your $cash-tag) that you can text, email, message or embed in your website. This link will take them to the “Cash.me” page where they can either log into their Cash App or enter their name and email address along with their credit or debit card information.
Accepting Cash App Payments Without A Business Account
The Cash app used to live in its own little silo apart from the rest of the Square ecosystem, but that’s no longer the case. If you use Square as your payment processor, you may be able to accept Cash App payments without a Cash App account. The Cash app is enabled as a payment method by default when you’re using a compatible Square program. However, if you don’t want to accept Cash App, this feature can be turned off.
The following Square products can accept Cash App:
- square register
- square stand,
- Square Terminal
- Square Online
- Square POS app for mobile devices
Should You Use Cash App For Business?
Cash App’s business applications are narrow but powerful.
For businesses that do fewer and smaller transactions, Cash App is an amazing feature. You’ll be able to do Cash App and credit card transactions outside the mobile device you’re already using with minimal fuss and no hardware expense. The flat 2.75% transaction fee recalls the old days of Square; With no flat markup, it is economically possible to make very small transactions.
That said, the Cash app is extremely limited. It offers the ability to take payments and that’s about it. Cash App will send you a 1099-K form if you make more than $20,000 in transactions in a calendar year (less if you’re based in Massachusetts, Vermont, Maryland, Washington DC, or Illinois). In addition, you are responsible for tracking taxes and transactions. Add to that the limit for sending and redeeming money and you have a device that is not suitable for high volume businesses.
Looking for something similar to Cash App? Check out our guides to using Venmo and Zelle for business.
Common Questions About Cash App Business Accounts
Can a business set up a Cash App account?
Yes, a business can set up a Cash App account by creating a personal account and converting it into a business profile.
Is Cash App good for small business?
Cash App can be excellent for very small businesses with low transaction volume. However, this will not be enough for high-volume businesses.
How do I know if my Cash App is business or personal?
By default your Cash App account will be personal. If you want to make it a business account you will have to convert it manually. Business accounts currently have a small building symbol next to the account name.
What are the limits on a Cash App business account?
Verified Cash App business accounts have the following limitations:
- $7,500 per week sending limit and $17,5000 per month with a verified account.
- $25,000 per week limit on cashout
Unverified accounts can do $250 worth of transactions in a day and $1,000 within a 30-day period
Does Cash App charge a fee for business accounts?
Receiving money from Cash App business account comes with a 2.75% fee. The only other charge for instant deposit is 1.5%.