"That’s strange, I’ve used square for years for knife sales and never had any problems. Maybe the way I set it up, I don’t know. It’s just set up to the bank account I have for my knife business and the money goes right into it."
I set it up that way, too. Then after the first real charge ($200) they suddenly wanted my banking records for the last six months, other personal records, and account access to view my banking deposits and withdrawals. They asked for a copy of the sales receipt, and how I knew the customer (he is well known, a repeat customer for 10 years, and the card is his). They asked for business, banking, and tax records and numbers that I do not have or would not give anyone except my CPA. I tried to answer all the questions and provide what info I could, but the system would not let me enter any of it without all of it. Repeated emails for help got no response. I chalked it up to a $200 learning experience.
BTW, they never returned the money to the customer either. The next year, I asked him if he had any issues with his card or contact from Square, and he said no. When I told him that Square had refused to transfer the money to me, he felt terrible and offered to pay me again with cash, but I told him it was my issue not his.