What if you could pay people via email? While it has become commonplace for social platforms to offer one-step payment services, in 2013, Square Cash was an innovative solution that did away with the intermediaries.
Users only had to connect a debit card and then they could pay people through email, without the multiple steps and delays associated with online payments at the time. It launched Android and iOS apps which simplified the process even further, and added mobile number functionality a year later.
In 2015, Square made Cash available for businesses in the United States. This was the first step towards monetization, as businesses were charged 1.5 percent per transaction, while users can send money to friends for free.
Pulling from Jack Dorsey’s other venture Twitter, Square also launched $Cashtags, another unique identifier to pay people and businesses.
In 2016, Square started to flesh out the app, starting with an ability to maintain a balance.
This was done so Square could get costs under control. Due to the zero transaction cost, Square loses money each time a user withdraws money, so maintaining a balance improves customer contribution. In 2015, Square was losing money each time a customer signed up, but in 2017 the average customer generated $15 in revenue, which has since doubled to $30.
It also made the Cash App more competitive with other peer-to-peer solutions, like Venmo, which allowed users to hold funds. However, it went against the original sentiment of Cash App, which was a no-frills, one-step payment service.
Square also debuted the Cash Card in 2017, a debit card for those wary of using their phone to pay for things. Out of the 30 million monthly active users Cash App has, seven million own a Cash Card.
Another addition to the Cash App, and one that has rapidly accelerated revenue generation on the app, is bitcoin trading. In 2018, Square added the ability to buy and sell bitcoin, as well as transferring it to a digital wallet, all without the transaction times and costs associated with bitcoin marketplaces.
It has since become the leading source of revenue for Cash App, accounting for 72 percent of its revenue in the second quarter of 2020. Square made “negligible” revenue in the first few years, according to chief financial officer Amrita Ahuja, but in the past two has recorded significant revenue growth, primarily because of the introduction of bitcoin.
It also launched zero commission stock trading inside the Cash App, putting it in direct competition with Robinhood. It’s clear that Square wants Cash App to be more than simple payment tool, but a hub for all financial interests – all it needs now are the typical bank services: loans, mortgages and savings.
In 2018, Square also made the Cash App available in the UK. So far, the app functions much like it did in the US pre-2016, as nothing more than a peer-to-peer payment tool. Square has not said if it plans to add bitcoin and stock trading onto the UK version.
We have collected data and statistics on Square’s Cash App, read on below to find out more.
Cash App Overview
|Launch date||15 October 2013|
|HQ||San Francisco, California|
|People||Jack Dorsey (CEO), Jim McKelvey (director), Amrita Ahuja (CFO)|
Cash App Revenue
|Q1 2018||$66 million|
|Q2 2018||$78 million|
|Q3 2018||$117 million|
|Q4 2018||$142 million|
|Q1 2019||$202 million|
|Q2 2019||$260 million|
|Q3 2019||$307 million|
|Q4 2019||$361 million|
|Q1 2020||$528 million|
|Q2 2020||$1.2 billion|
Cash App Profit
|Q1 2018||$27 million|
|Q2 2018||$38 million|
|Q3 2018||$51 million|
|Q4 2018||$78 million|
|Q1 2019||$85 million|
|Q2 2019||$105 million|
|Q3 2019||$123 million|
|Q4 2019||$144 million|
|Q1 2020||$183 million|
|Q2 2020||$281 million|
Cash App Monthly Active Users (MAUs)
Cash App Downloads
Cash App Bitcoin Revenue
|Q3 2018||$43 million|
|Q4 2018||$52 million|
|Q1 2019||$65 million|
|Q2 2019||$125 million|
|Q3 2019||$146 million|
|Q4 2019||$178 million|
|Q1 2020||$306 million|
|Q2 2020||$875 million|
Cash App Card Owners
Cash App Annual Revenue per MAU
Source: Business Insider
Cash App Percentage of Square Gross Profit
Source: Business Insider
Square vs Venmo & Zelle: Total Payment Volume
Note: Square total payment volume includes income from outside the Cash App. If broke down, Venmo would most likely be ahead of Cash App.
Cash App other key stats
- Square noticed a 127 percent increase in quarterly revenue in Q2 2020 and 361 percent increase year-on-year (Square)
- Bitcoin transactions accounted for 72 percent of Cash App’s revenue in Q2 2020 (Square)
- Daily active users grew at 80% year-on-year, faster than MAU growth (Fool)
- Square sold Caviar, a food delivery service, to DoorDash in 2019 for $410 million (CNBC)
- Cash App users have stored a total of $1.7 billion (ZDNet)
- Square surpassed PayPal’s Venmo in total downloads in 2019 (Instinet)