(Page 2 of 2)
Paperless trail: Square can send receipts by e-mail and SMS. Merchants can choose a charity to receive a portion of each transaction fee.
Square
By creating a Square account, payers can obtain extra features, too, Dorsey says. For example, a user can arrange to receive a text message every time his credit card is charged using Square. Or he can upload a picture that will display to the seller whenever the user's credit card is swiped. "We put a big focus on how to get the payer involved in managing security," Dorsey says.
Still, some experts are skeptical of Square's prospects. Jon Paisner, a senior analyst at Yankee Group who studies mobile transactions, says the need to plug in an extra piece of hardware to use Square might prevent people from adopting it. Paisner also worries that the device won't be sturdy enough in the long-term, and that audio jacks may not stand up to this kind of unintended use.
Paisner thinks there is potential for payments via mobile phones to take off in the United States and United Kingdom, but he thinks near-field wireless communication technology, which would allow users to make payments by tapping a phone against a reader, is more promising.
Mark Beccue, a senior analyst at Abi Research who studies consumer mobile technology, also has reservations. "What puzzles me is, what market we are addressing here?" he says. "I saw a video of using [Square] in a coffee shop and thought, 'Don't they have a cash register?' " Beccue concedes that the product may work for certain niches, such as markets or art fairs, but he doesn't think it has mainstream appeal. He suggests that most small businesses will prefer traditional point-of-sale systems for managing credit cards, and that ATMs are convenient enough that individuals aren't likely to turn to Square to pay each other.
Pilot tests of Square are being conducted in San Francisco, Los Angeles, New York, and St. Louis. Dorsey says the company hopes to open to the public in early 2010.
A startup says technology that lets webcams read credit-card details will make transactions easier and more secure.
The company wants to play a key role in electronic mobile payments, but faces big challenges and big competition.
Square, founded by the creator of Twitter, lets people accept credit cards with their smart phones. That innovation could transform transactions in surprising ways.
Why not use the camera to capture the credit card information?
There can be as many as 3 bands of data on the mag stripe.
But the information visible on the card is sufficient to make a purchase. (When a purchase is made online or via phone, the purchaser relays only that information to the vendor.)
If the current economy is any symbol, the U.S. is just barely in the credit card market and Touch & Pay options are absolutely foreign to most people, even myself (and I'm up to date). U.S. banks all gave up on smart cards and now those are limited to Kinkos and the occasional bus pass, while being used broadly in European countries.
Square is about new micro-economies. It's not looking to replace the systems for McDonalds or H&M, it's about empowering individuals to be able to take all forms of payment. Yes of course farmers markets and art fairs would be commmon users, but what about small start-up retail locations that may find using Square cheaper than a severely over-priced relationship with Visa or MC.
Instead of guessing on whether its the next big thing, how about letting it play out. Good ideas become great ideas and the lesser sink to the bottom. The reservations about Square are part of what keeps this country technologically in the dark and the same tired arguments cash proponents still use.
Agreed! Give it a chance.
I can see considerable personal use for the concept. Paying the kid who mows the lawn or getting paid when I work as a flight instructor are examples.
However, it might be simpler to just transfer credits from my cell phone account to his via an IR link or bluetooth - leaving the credit card companies out of it.
Do you need a Square card, or will it read any card? If any card, then I don't see how the merchant is getting out from under Visa, Mastercard, etc. They will still take their cut. If you need a Square card, then you've got a classic chicken/egg problem.
However, those normal card reader things are probably very expensive. And of course they need a land line. I can see Square being very useful at farmers' markets, craft fairs, computer expos, hobby shows, etc. Besides street vendors, how about those vendors that walk around at sporting events? I'd be leery of a brick and mortar store not willing to invest in a normal card reader device -- doesn't show much confidence in their chances.
One problem -- possibly a big one -- is that many of those potential users might not want solid electronic records of their sales transactions. Makes it too easy for Uncle Sam to audit.
It works fine at the Apple Store
Apple is using something similar. The transaction processing vendor is the bottleneck and there are plenty of folks who will want to do it. No tie-in for hardware vendor, no problem with programming around other people's XA programs! You could sell thousands of intangible products easily. Somebody just has to create a configurable iPhone app - 1. put in the XA route #, 2. choose position for dollar amount, 3. optional keystorkes depending on XA processor agreement. Get an email or text with confirmation. That's it and then millions of little vendors who can't get a merchant account will be liberated. This makes transaction processing at the merchant level a no-brainer. The additional security allowing me get notifications is fabulous.
Why do you think that Visanet went public last year? DUH...
The "seller" must not be able to create what are called "man in the middle" software to capture of the buyer's credit card information. That would be a deal breaker. Square needs to work very hard to detect that and prevent it.
how would you know whether the vendor is running square's app? there's really no way for square, or anyone, to prevent that.
I agree there are substantial hurdles to overcome with this technology. However, what the analysts are not considering is the pull and attraction of using iPhones to make payments. The buzz and curiosity of where iPhone technology is leading us could be a strong factor in motivating people to try this system. It could be very interesting for markets, festivals, art shows etc. where you use the card to make all the payments on the day. I too would prefer to not rely on a plug-n-play 3rd party device and would rather use just my phone.
There are already a handful of "micro" readers out there. They store the info so that the vendor can process it later. They're expensive but getting cheaper...however hardly worth it because all they do is *store* the info. I am a full-time crafter and do dozens of craft fairs all year long. I currently cannot afford an electronic card reader or a micro reader. If am am vending in an area that does not provide wireless internet, then the micro reader is no better than the old-fashioned knucklebuster carbon paper imprinter to me. I can either just store your CC info on some paper to process later, or I can swipe it quickly into a reader. The only difference is the SPEED at which I am able to do both. Your precious CC info is the same in either capacity... whether digital or on actual paper the info must be "protected" or "destroyed" at some point. Who does it or when it happens or how it happens is a trust that each and every consumer has each and every time we make a purchase anywhere, you know. Also... a micro reader cannot provide a receipt for the purchase.
This device could be awesome if two things happened... they focus on the *kinds* of vendors who could benefit immensely from something like this (small scale folks like myself who cannot afford much more than my iphone) and #2- if they provide some kind of e-mail receipt system to provide for the customers.
I've been waiting ALL YEAR or someone to come up with an Ap for accepting a CC at a craft fair. Right now I have to write down the CC info and process it later online with the service I use. Then once everything is settled I have to shred lots of paper and waste it all. Such a waste of time and paper. A small reader I could just attach and use quickly would save me so much time and effort.
I'd buy it as long as it were affordable.
I'm not sure about the details, but readers that work with cell phones are fairly common. Do a google on cell phone card readers. You will find several outfits that will hook you up to credit card services.
They are real. I know that a few years back, I had a plumber stop over. I gave him my CC, and he read it with a gadget that stored the numbers for later processing. I mentioned that soon, they would probably have some that would hook up tp cell phones. He said "Oh they do, but I have this, and it works well enough for what I do.
I was involved in a project which involved a CC payment option for users of library checkout system. Card reading is fairly trivial. Secure handling of the data is a major deal.
Paypal has helped me tremendously in software sales which is basically the idea to give the power of credit card processing in the hands of everyday people. Moving card swiping to mainstream vendors is a great idea, even street vendors. In terms of security, we give our credit cards over to gas station attendants, department store workers, to coffee baristas, etc. Many of these places still leave the full credit card number on the receipt so it would be easy for an employee in those low paying jobs to sell some cc info for extra cash. The security of the iphone reader would at least be encrypted and could potentially have a security sign come up so you can verify the validity of the reader (similar to how banks show your favorite animal, etc.). I tend to trust software more as long as there is a secure system in place. Once this is supported by a big company like PayPal or similar, I can see it taking off.
The 'experts' in the above article are missing the market. Taxi cabs. At the table payments in restaurants. Street vendors. Anywhere mobile or small where a Point of Sale system doesn't make sense. The potential market is huge.
Manufacturing in the United States is in trouble. That's bad news not just for the country's economy but for the future of innovation.
This document is part of the “How-To Guide for Most Common Measurements” centralized resource portal. This tutorial provides a detailed guide for measurement and device considerations to take temperature measurements using thermocouples. Get an introduction to thermocouples, which are inexpensive sensing devices widely used with PC-based data acquisition systems. Also review some specific thermocouple examples and learn how thermocouples work and ways to integrate them into a data acquisition measurement system.
View full PDF >
Listen to story > 
On Twitter
Become a Fan on Facebook
Subscribe to the Feed
carlhage
84 Comments
The catch might really be whether banks and the existing equipment manufacturers would allow it. Some friends who were dance teachers sold instructional videos at workshops paid for one of the mobile card machines. It was fantastically expensive-- several times the price of a laptop, but was nothing more than a printing calculator with a data-only phone. They had to pay that price because the bank required it. It seems that there is little competition for this equipment.
Note, the printer is the missing item in this iphone device. It seems to me it would have been better to include that.
If you are willing to type in the number, you could use a plain iphone for credit card transactions.
Reply