Option 1. You can use Text Block and Image Block
#1. First, you can add an Image Block and a Text Block

#2. Next, increase the Image Block Size and Drag Text over the Image Block

#3. Hover Text Block > Click this option

Result:

Option 2. Use CSS code
#1. First, install Squarespace ID Finder tool (free)
#2. Next, use this tool to find the Text Block ID. In my example, we will have:
- #block-yui_3_17_2_1_1713756430090_32812

#3. Use this code to Custom CSS box. Replace Pixabay with your background image URL.
div#block-yui_3_17_2_1_1713756430090_32812 {
background-image: url(https://cdn.pixabay.com/photo/2022/01/07/01/21/girl-6920625_1280.jpg);
background-size: cover;
background-repeat: no-repeat;
background-position: center center;
padding: 10px;
}

Result:
