As other businesses closed up temporarily in the face of a global pandemic, merchant services provider Square Inc. focused on nurturing a segment of its business.
The firm shifted focus to its 7-year-old person-to-person payment platform, dabbed Cash App (formerly known as Square Cash). According to Square’s 2020 Q3 results, Cash App performed remarkably well, making up ⅔ of the firm’s $3.03 billion in revenue.
The company’s executive financial officer Amrita Ahuja said Square sees lots of opportunities to invest more in this promising business segment.
Square’s CEO, Jack Dorsey, is a staunch digital currency lover. He even added a Bitcoin trading feature to Cash App, which now makes up ¾ of the platform’s entire revenue. Its trading revenue snowballed elevenfold throughout 2020.
In 2019, Square embedded in its Bitcoin feature, a brokerage option where users can purchase fractional stock shares. Nevertheless, the payment provider’s 1.63 billion dollars in Quarter-3 revenue was almost swallowed by some $1.6 billion in Bitcoin trading expenses.
So far, the company has not updated its monthly active-user count, which pegged at 24 million by the close of 2019. However, this figure included Square sellers using the Cash App to hawk items and take customer payments without touching money or cards. This number grew 332 percent YOY to an impressive $2.9 billion, as reported by Square executives.
Other Q3 findings show the “activeness” of Cash App users has also increased significantly. The share of everyday users has risen to 23 percent from 15 percent in 2019. This is partly due to the growing popularity of Cash App’s brokerage service.
Since its launch, an entire 2.5 million app users have purchased stocks through it, the company’s quickest adoption rate for any Cash App service.
Meanwhile, Square’s other segments, processing payments and providing retailers with payment gadgets, were outperformed by Cash App but still raked in a noteworthy $965.3 million in Quarter-3. This performance represents a 5 percent jump year-over-year.
Amidst a challenging environment for payment processors, Square managed to nurture and grow a segment of its diverse business. Cash App has indeed held the fort for Square as customer habits change and digital currencies popularize. Hopefully, 2021 will open new doors for the peer-to-peer payment platform.
Author Bio: Payment industry guru Taylor Cole is a passionate payments expert at bestpaymentproviders.com who understands the complex word of merchant accounts. He also writes non-fiction, on subjects ranging from personal finance to