[mbreese]

Think money laundering, "personal service" industries, etc...

Unfortunately, there is a reason why getting a merchant account is a pain in the ass. The bank doesn't want the risk (for good reason).

The thing about Square isn't the device... it's the service. So when things go poorly, they will be the ones that have to foot the bill. If they open things up too widely, then they will be exposing themselves to huge risk.