Cash App settlement pays cash to military loan borrowers

A class-action lawsuit accusing Cash App of lending money to certain military borrowers at interest rates higher than the federal Military Lending Act allows has ended in a cash settlement of $615,000.

Borrowers were hit with high interest rates

The Cash App lawsuit claimed that First Electronic Bank, Square Financial Services and Block, Inc. all issued loans to military borrowers at interest rates that were higher than allowed.

The court granted preliminary approval to move forward with the cash settlement on Sept. 28, 2026. The lawsuit claimed that the lender exceeded the 36% allowable interest rate to covered borrowers (at the time of the loan) under the Military Lending Act.

A "covered borrower" is an active-duty member of the Armed Forces, Guard member, Reserve member or a dependent of an active-duty member.

Class members can get a cash payout

According to the court documents, 1,720 people are listed in the class action lawsuit.

There's no need for covered borrowers to file a claim form. Instead, they will be sent a pro rata (proportional) cash payment of about $58.95 for each eligible Cash App Borrow loan that exceeded the allowable interest rate.

The amount people will receive varies, and there may also be a second cash payout.

The wait for final approval begins

Despite the court granting preliminary approval of the cash settlement, a final settlement must now be granted. That final hearing is scheduled for March 23, 2027.

Between now and the final hearing, there is nothing class members need to do other than update their contact information and digital payment method on the class action website.

Class action members were sent settlement notices and in that notice was a login ID and PIN they can use.

Know your rights when it comes to loans

This is a great reminder to be aware of your rights when it comes to loans, especially when it comes to the interest rate offered.

Sources: ClassAction.org, Class Action Portal Login