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Square Expands in Europe, Where SMBs Dominate

Hardware and payments platform Square, which was founded by Twitter’s CEO Jack Dorsey, is accelerating its European expansion, having launched its business in Ireland and France earlier this year. The company recently added a third country to its eurozone list, enabling businesses in Spain to participate in the beta testing of its Early Access Program this month.

The limited-space program, which offers exclusive access to omnichannel tools used by millions of businesses worldwide, is available to companies interested in testing Square’s services prior to general availability.

Read more: Square Seeks Spain-Based Businesses for Beta Test of Omnichannel Tools

According to the announcement, merchants that enroll in the program can get access to free Square hardware, without the constraints of long-term contracts or startup fees. 

See also: Square Sellers Can Accept Payments With Cash App Pay

Speaking on the announcement, Jason Lalor, Square’s executive director for Europe, said the program targets businesses of all sizes that can grow using the company’s “omnichannel ecosystem of hardware and software.”

Services provided by the Silicon Valley-headquartered company include point-of-sale software and hardware to seamlessly sell in-store and online, as well as tools to build an online store.

UK as a European Launchpad

Like other North American companies looking to expand in Europe, Square chose to launch from the U.K., starting operations in the country back in 2017.

“The U.K. is arguably the global FinTech hub,” said Clearco Head of U.K. Sarah Clark in an interview with PYMNTS’ Karen Webster this month. “There’s great talent here, and there’s a strong regulatory framework.” Clark added that in her view, London is second only to China when it comes to advanced eCommerce markets worldwide.

The lending firm Clearco recently chose to set up an office in London when it moved out of its home base in North America for the first time, while accounting workflow software firm FloQast made a similar move as it launched operations in Europe, the Middle East and Africa (EMEA).

SMBs Dominate in UK/Europe

Even though Square’s program is available to businesses of all sizes, the majority of the firm’s European clientele will be small and medium-sized businesses (SMBs), which represent 99% of companies in Europe, according to data from the European Commission.

In the U.K., SMBs represented 99.3% of the total business as of the start of 2020 and accounted for three-fifths of the employment in the private sector, according to the U.K. National Federation of Self-Employed and Small Businesses.

And given the dominance of these small to medium-sized firms in the region, governments regularly ensure that payment-related measures are implemented to support SMBs, particularly in times of crisis. According to a recent European Commission report, the three European countries where Square operates supported SMBs with various business measures during the COVID-19 pandemic.

The French government allowed SMBs to reduce the working hours of their employees during the pandemic and increased the proportion of workers’ monthly wages subsidized by the government from 70% to 100% for up to €6,927.

In August 2020, Ireland launched a loan guarantee scheme mobilizing €2 billion for SMBs and offering financial intermediaries an 80% loan guarantee on loans between €10,000 and €1 million taken out by firms with less than 500 employees. And starting in March 2020, SMBs and self-employed workers in Spain that have a turnover of less than €6 million are allowed to defer their tax payments by six months for payments below €30,000.

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