![]() ![]() ![]() 1 In September 2021, the service reported 70 million annual transacting users and US 1.8 billion in gross profit. The CFPB says consumers having issues with any financial entity can file complaints here. Cash App (formerly Square Cash) is a mobile payment service available in the United States and the United Kingdom that allows users to transfer money to one another (for a 1.5 fee for immediate transfer) using a mobile phone app. The CFPB urges users to check whether the app they're using has a partner bank with insurance and to sweep money off the app into a federally insured bank or credit union accounts so that it will be protected if the app should suffer any financial distress. ![]() Some states, including Texas, recently enacted laws to ensure these apps can meet their obligations. So what happens if this non-bank entity goes out of business? What am I going to do?" said Amy Zirkle, Senior Program Manager of Payments and Deposits Markets for the Consumer Financial Protection Bureau. And we're trying to think through, strategically through, what a worst-case scenario might be. But that level of insurance doesn't apply to a non-bank, were it to fail. ![]() "If a bank fails, it's got the FDIC insurance that protects it. Not only are the payment apps not required to be insured, but the CFPB also says their user agreements often lack information on whether your funds are insured or how the money is invested. In those cases, customers were protected through FDIC insurance. ¹ Early access compared to standard banking practice of posting funds at settlement and subject to your employer providing pay information to the bank prior to payday. The CFPB is especially concerned after three banks, Silicon Valley Bank, Signature Bank, and First Republic Bank, failed this year. If you leave your money in the app, the app holds and invests your money.īut these apps are not banks, so they are not required to be FDIC insured. It says when users receive payments, the money is not usually swept into a linked bank account. ![]()
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