Twitter founder pushes Square’s payment device over NFC
Square Inc., the mobile payments company created by Twitter Inc. co-founder Jack Dorsey, said its credit-card reader for smartphones will be available in Wal-Mart Stores Inc.’s locations nationwide, boosting the number of retail outlets where it is sold to more than 9,000.Updated: Oct 24, 2011 15:39 IST
Square Inc., the mobile payments company created by Twitter Inc. co-founder Jack Dorsey, said its credit-card reader for smartphones will be available in Wal-Mart Stores Inc.’s locations nationwide, boosting the number of retail outlets where it is sold to more than 9,000.
The reader, which lets businesses handle payments via mobile devices, was previously available in about 200 Apple stores, as well as Target Corp., RadioShack Corp. and Best Buy Co. outlets.
Square is targeting small businesses that may not be able to afford machinery that handles credit cards, Chief Operating Officer Keith Rabois said in an interview. The company is vying with EBay Inc.’s PayPal as well as providers of near field communications (NFC) to help consumers pay for things on the go. At stake is a mobile commerce market that Juniper Research predicts will surge to $670 billion in 2015.
Payments have a lot of friction, a lot of distraction, Rabois said. We can’t eliminate all of that this month, but our mission is to make Square ubiquitous.
Square’s technology lets U.S. businesses handle payments via Apple’s iPhone and iPad, as well as devices running on Google’s Android software. The card reader plugs into the headphone jack of the mobile device and lets merchants swipe customers’ credit and debit cards.
The device can be ordered free on the Web. The reader is sold at stores for $9.99, a cost that can be refunded online. Square makes its money from each transaction, with merchants paying 2.75 percent of the amount paid.
Square publicly launched last October and has about $140 million in funding, according to regulatory filings.
Square vs. NFC
The company is betting that consumers will choose its system over near field communications, which lets phones function like credit and debit cards by waving them in front of a reader. The process requires customers to take out a phone and place it near a reader, much like they already do with a credit card, Rabois said.
We don’t currently believe that NFC as a payment technology is likely to improve either the merchant’s experience or the buyer’s experience, he said.
More than 800,000 of Square’s devices have been shipped to merchants. The company says it is processing more than $2 billion in payments on an annual basis. PayPal expects more than $3.5 billion in mobile volume this year and processed $29.3 billion total in payments in the third quarter, according to a statement by the San Jose-based company last week.
First Published: Oct 24, 2011 15:05 IST