Skip to content Skip to sidebar Skip to footer
Menu
Menu
News Tech

Square: This Iowa bank powers their new cash app

Square Cash App
March 13, 2018

The newest feature Square added to its Cash App is powered by a bank in Northeast Iowa.

According to a story last Wednesday on Tech Crunch, the Cash App from Square offers out support for direct deposits, allowing Cash App users to get their paycheck or other deposits put directly into their Cash App balance. After accepting a disclosure, the user is given an account number and routing number. Users then get a notification when deposits hit their account.

And since Square doesn’t have a bank charter, Tech Crunch reported the direct deposit feature is powered by Lincoln Savings Bank, which is headquartered in Reinbeck and has locations throughout Central and Eastern Iowa.

Mike McCrary is the Vice President of e-commerce and emerging technology for Lincoln Savings Bank and told Clay & Milk that conversations with Square started as far back as 2016.

“We, unfortunately, cannot give a lot of details,” McCrary said when asked about specific details between Square and Lincoln Savings Bank. “It’s tricky, but we’re awesome.”

McCrary said that back in 2013, Lincoln Savings Bank made the decision that FinTech was something to keep an eye on.

“We were seeing Dwolla, Stripe and others picking up on specific pieces of the industry and building something more elegant around that, whether it was for saving money, spending money or moving money,” McCrary explained. “We decided this is a thing we need to put some resources towards. The thought process was either build our own or partner with people who are building.”

McCrary said the team at Lincoln Savings Bank was impressed with Square not only for its technology but its company culture.

“When we first approached them we were a little intimidated by their size, I mean it’s Square,” McCrary said. “But one of the things we realized pretty quickly was that we felt we were all on the same page. It speaks to the sincerity and the work culture at Square.”

Karris Golden is the VP of e-commerce operations for Lincoln Savings Bank and agreed that the company culture at Square fit in with their own.

“They value our input and the work we do,” Golden said. “This world-class organization is making a strong attempt to bring that trust in banking to the FinTech space.”

He said Lincoln Savings Bank has also worked with Painless1099 and Qapital.

“We’re always happy to talk to fintechs, new or later-stage about what they’re building,” McCrary said. “It’s an energized and diverse community we’re pleased to be part of.”

McCrary hopes Lincoln Savings Bank can leverage the relationships its built with Square to make itself a better community bank.

“We feel super cool,” McCrary says. “We really value our corporate roots of being an Iowa community bank, that’s the center of the story for us.”

 

Square: This Iowa bank powers their new cash app | Clay & Milk
A central Iowa ag-tech accelerator has secured more backers and finally has a name. The Greater Des Moines Partnership first announced the accelerator last year, naming four initial investors. On Monday, the Partnership said the program will be called the "Iowa AgriTech Accelerator" and named three new investors. The new investors include Grinnell Mutual, Kent Corp. and Sukup Manufacturing, all Iowa companies. They join investors Deere & Co., Peoples Co., Farmers Mutual Hail Insurance Co. and DuPont Pioneer. Each investor has agreed to put up $100,000 for the first year of the accelerator. Startups entering the program will receive $40,000 in seed funding in exchange for 6 percent equity. Tej Dhawan, an angel investor and local startup mentor, is serving as interim director until the AgriTech Accelerator names a permanent leader. Dhawan held a similar role with the GIA before Brian Hemesath was named as managing director. As interim director, Dhawan said his main job includes hiring the accelerator's executive director, establishing a business structure and initial recruiting for the first cohort. The accelerator will place few filters, such as location and product, on the applicant pool, Dhawan said. "When you’re seeking innovation, innovation can come from every corner of the world so why restrict ourselves," he said. One area the the AgriTech Accelerator won't recruit from is biotech. For its first cohort, the AgriTech Accelerator will work out of the GIA's space in Des Moines' East Village, Dhawan said. A future, permanent home is still to be decided. The accelerator's program will host startups from mid-July through mid-October, ending with an event connected to the annual World Food Prize. The GIA, which the AgriTech Accelerator is based on, also ends with presentations at an industry event. The accelerator has also started lining up a mentor pool. The Iowa Corn Growers Association, Iowa Soybean Association and the Iowa Pork Producers Association have agreed to provide mentors, as has Iowa State University. While the AgriTech Accelerator is loosely based off of the GIA, it will differ in its business structure, Dhawan said. The GIA runs through a for-profit model for both operations and its investment fund. The AgriTech Accelerator will have a nonprofit model for its operations and a for-profit setup for its fund. Dhawan said the nonprofit model is being used so the accelerator can better work with other nonprofit partners, such as trade associations. "These are all organizations that are nonprofits and can be amazing stakeholders without ever having to be investors in the accelerator," he said. "It becomes easier to work with trade associations in their nonprofit role when we are also a nonprofit." When it's up and running, the AgriTech Accelerator would be one of a handful of ag-focused startup development programs in Iowa. Others include the Ag Startup Engine out of Iowa State University and the Rural Ventures Alliance from Iowa MicroLoan. Matthew Patane is the managing editor and co-founder of Clay & Milk. Send him an email at mpatane@clayandmilk.com.
This Pop-up Is Included in the Theme
Best Choice for Creatives
Purchase Now