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Square and Venmo offer to deliver stimulus payments

Square and Venmo offer to deliver stimulus payments

Square and Venmo parent PayPal are talking to the US government about using their apps to deliver Covid-19 stimulus payments to Americans that do not have bank accounts.

The $2 trillion stimulus package signed into law on Friday will see millions of Americans receive direct payments from the government.

Treasury Secretary Steven Mnuchin said over the weekend that recipients could expect to see the money direct deposited into the bank accounts within three weeks.

However, according to Federal Reserve figures, 14% of Americans with an income of under $40,000 do not have a bank account.

Jack Dorsey has taken to Twitter to suggest that his other company, Square, as well as its peers, could be used to reach these underbanked people, saying "US government: let us help."


Citing sources, CNN says Square and PayPal have held talks with the Treasury Department about the subject, arguing that their Cash App and Venmo services would get money to people more quickly than sending out cheques.

How likely the Treasury is to take up the offer is unclear, says CNN. Currently, talks are taking place about how to solve the technical issues and what data the government can share with the companies.

The Electronic Transactions Association (ETA), which represents payments firms including PayPal and Square, has also been lobbying the government to take advantage of its members' services.

In a letter to Mnuchin and President Donald Trump, ETA CEO Jodie Kelley makes the case for using prepaid cards for stimulus payments, rather than cheques which have to be mailed and then clear.

Meanwhile, for the unbanked, she argues, electronic options such as Venmo cut out the need to use expensive cash chequing services.

Finally, "utilising many of these electronic payments options helps Americans reduce the chance of exposure to the virus by avoiding handling cash, shopping online, and maintaining social distancing by not entering branches or check-cashing stores".

Comments: (3)

Simone Marino
Simone Marino - fuel oil trading - Monaco 30 March, 2020, 17:41Be the first to give this comment the thumbs up 0 likes

Bitcoin is the answer: you don't need a bank account, you don't need an internet connection, you don't even need a phone/pc !!!!

A Finextra member
A Finextra member 30 March, 2020, 17:59Be the first to give this comment the thumbs up 0 likes

Unneccesary and just an intermediary - the US Treasury can simply establish temp deposit accounts with banks and use KYC to identify the unbanked to receive their cash 

Simone Marino
Simone Marino - fuel oil trading - Monaco 30 March, 2020, 18:29Be the first to give this comment the thumbs up 0 likes

ok then i guess we all agree that the news reported in the article is also unnecessary and just an intermediary ... ;) 

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