If Square's service failure, security breach, or wrongful account suspension causes your business significant financial loss, you can only recover a small fraction of that loss — capped at your prior year's fees — regardless of how much damage actually occurred.
Square's Terms of Service create significant limitations on users' legal recourse through mandatory arbitration and a class action waiver, effectively preventing group lawsuits against the company. Square retains broad discretion to suspend or terminate accounts — including holding funds — with limited notice, which poses material financial risk to merchants who rely on Square for payment processing. You can opt out of the mandatory arbitration clause by sending written notice to Square within 30 days of account creation or within 30 days of any material update to the arbitration terms.