Block's XYZ banking subsidiary, Square Financial Services (“SFS”), has introduced Square High Yield Savings, allowing eligible Square sellers who maintain at least $10,000 in daily cash reserves in their Square Savings account to earn a 3.5% annual percentage yield (APY). The offered rate is significantly above the national average savings account yield, enhancing the value proposition for merchants using Square's ecosystem.
The initiative supports SFS' strategy to grow core deposits while providing sellers with an attractive return on idle cash. A larger deposit base can also strengthen SFS' ability to fund lending programs and further expand Block's suite of financial services for businesses and consumers.
Square sellers can automatically allocate a portion of their daily sales into their Square Savings account through the Square Dashboard. Once account balances reach the $10,000 threshold, the higher APY is activated automatically.
Key features of the program include no minimum deposit requirement, no monthly maintenance fees and FDIC insurance coverage of up to $2.5 million through the Square Savings deposit sweep program. Interest accrues daily and is applied to the entire account balance.
Square plans to launch an automated sales tax folder within Square Savings. The feature will automatically set aside sales tax collected from eligible card transactions, helping sellers streamline cash management and reduce administrative work. The tool will leverage existing Square tax settings and support businesses operating across multiple locations and tax jurisdictions.
Conclusion
Block’s launch of Square High Yield Savings strengthens the value of its merchant ecosystem by offering competitive returns on cash reserves while encouraging deeper use of its financial services. Combined with upcoming cash management tools, the initiative supports deposit growth, enhances seller convenience and expands the capabilities of Square Financial Services.
Over the past three months, shares of this Zacks Rank #1 (Strong Buy) company have gained 16.1% against the industry's decline of 1.8%.
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Stocks to Consider
Some better-ranked stocks from the internet-software sector are BILL Holdings, Inc. BILL and Atlassian TEAM, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
The Zacks Consensus Estimate for BILL’s 2026 earnings per share (EPS) has moved northward by a cent to $2.64 over the past week.
The consensus estimate for TEAM’s 2026 EPS has moved up 17.1% to $5.48 per share over the past two months.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
Zacks' Research Chief Names "Stock Most Likely to Double"
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BILL Holdings, Inc. (BILL) : Free Stock Analysis Report
Block, Inc. (XYZ) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
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