The Square debit card: What we know

Back in April, Square Founder Chief Jack Dorsey teased the possibility of the company launching a debit card – a minimalist black piece of plastic with room in the lower-right corner for the cardholder to doodle their name or Twitter handle (as Dorsey did).

Curiosity has been building, but details have been trickling out slowly. Square confirmed to Recode that Square debit card is indeed being launched. And Square Cash users are tweeting that they’ve been invited (via in-app push notifications) to order a card.

Assuming the card becomes available to all, should you get it? Here’s our take, based on what we know.

How the Square debit card works

This is not a card you’ll link to a bank account. Instead, it hooks up directly to the balance in your Square Cash account.

If you’re not familiar, Square Cash is an instant-money-transfer service (like Venmo), which allows you to pay friends and family (if you’re splitting a check, for example) or businesses directly from your bank account. When someone sends you money via Square Cash, you can then deposit it in your bank account (free if you wait 1 business day, 1 percent of the balance for immediate deposit). The app also gives you a virtual card that lets you immediately use your Square Cash balance to shop online or with Apple Pay.

The new physical debit card allows you to use Square Cash funds in the physical world instantly (without Apple Pay). Friend pays you back for something with Square Cash? You can immediately swipe your Square debit card to buy drinks. No need to rely on the merchant accepting Apple pay or waiting a day for your Square Cash balance to work its way into your bank account.

For Square, the main benefit is getting more consumers thinking about its brand and branching out of its core merchant-facing card-acceptance business.

How exciting is this card?

This card looks cool, with its sleek design and the ability to customize. Recode confirmed that you can customize the lower-right corner with a first name, Twitter handle or doodle (although these customizations will be screened before Square will print a card for you). See what some of early recipients of the card have put on theirs.

Another potential advantage is the ability to use your Square Cash balance in real time in the real world.

Beyond that, this is just a neat-looking debit card. Unless you have a large Square Cash balance you want to use immediately with a card bearing your Twitter handle, there’s no big advantage over any other debit card.

Besides, when it comes to making any purchase, especially a big one, we suggest avoiding debit and using credit. Credit cards provide various purchase protections and extended warranty coverage. So we wouldn’t recommend using the Square debit card (or any debit card, for that matter) to buy electronics or gadgets.

Even little purchases are often worthy of credit cards because of the rewards. Why would you use a debit card to pay for brunch, when you could get 2 or more points per dollar with a card that gives bonus rewards at restaurants?

Even earning a little cash back at a time on other small incidental purchases adds up.

Square could always end up launching a rewards program for its debit card. But, in the meantime, we think using a credit card and then transferring your Square Cash funds to a bank account to pay it off is a smarter move.

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It is a smart marketing technique that is often used by financing companies. They market their products and services through their attractive cards which attract potential customers. People who love the design of the card will be enticed to this first level of marketing and move on further to sign up for a product or service provided by the company.