Are you a merchant that accepts credit cards or has always wanted to accept credit cards but have had concerns about paying for costly credit card processing equipment, trying to figure out the sometimes complicated fee schedules, and working out the logistics of accepting credit cards on the go? If so, then you are the target market of Square, the mobile payment service that can best be described as PayPal for credit cards using just a Smartphone that was recently launched by Twitter co-founder Jack Dorsey.
Dorsey announced the launch of Square in a tweet on 12/1/09 at 1:03 PM. (Where else?)
How Square Mobile Payments Work
The way the Square payment service works is that the merchant that wants to accept mobile credit card payments hooks up the Square dongle (picture below) to their smartphone by inserting the tip into the phone’s audio jack. Once the dongle is hooked up to the phone (the dongles are provided free by Square) then anywhere the merchant can take their phone they can accept credit card payments by just having their customers swipe their credit card through the external portion of the dongle.
How Much Does Square Cost?
Square has not released rate sheets yet but according to the Square website there are “no contracts, monthly fees, or hidden costs”. Square also donates 1 cent of every transaction to the charity of the buyers choosing.
Square vs. PayPal
There is nothing quite like Square out on the market right now although the first competitor that comes to mind is PayPal. PayPal allows credit cards to be hooked up to any PayPal account and they offer many different ways to make payments including payment via SMS text message, payment via email, etc. However, the major advantage to using Square’s mobile payment service is that the customer is not required to sign up for anything as all they need is their credit card to make a payment via the Square mobile dongle where with PayPal both parties must have PayPal accounts.
Additional Features of Square
Some of the additional features of the Square mobile payment service that may be interesting to many small business owners include:
- Text and email receipts
- 1 cent charitable contribution for every transaction
- Photo verification
- Rewards program management (i.e. “Buy 9 coffees get the 10th free” without having to worry about loyalty cards)
- Lightweight and ultra portable credit card swiping dongle
What do YOU think of the Square mobile payment service? Would you have any issue swiping your credit card on a business owners phone to make a payment? If you are a business owner would you find the Square payment system something you would consider using?
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