It was about a year ago, or the summer of 2010 when I began hearing about these mobile credit card readers that enable a small business to accept payments in the field. But to my dismay, they were supported by only the Iphone , and there was a ridiculous monthly subscription fee, to boot. I’m not an Iphoner, and for the type of business I conduct, a monthly subscription fee doesn’t make cents for the occasional transaction in the field.
So I was excited when I discovered this past weekend a new option , a FREE (or next to nothing) option to take payments in the field. SQUARE provides a simple, attractive interface to allow you to accept credit card payments. It’s free to use the software, and the credit card reader device is also sent to you for free once you sign up. But of course, Square must pay its bills, and takes a 2.75% fee from every transaction. It’s roughly the same fee that PayPal merchants pay, very reasonable.
Setup
Go to the square site or download the App for iOS – iPod touch and iPad – and Android. The signup process involves entering your business tax information, or your Social Security number. They’re a secure site, and promise to protect your data, but you should always be cautious when asked for this kind of data. Once you’ve registered, square will send you the free card reader in the mail. I got mine in about 2 days after signing up.
Selling
If your business regularly sells the same items, you can setup a virtual shelf with all the items you sell, automating the checkout process, to a degree. If not, you only have to key in the amount of the transaction, and swipe the card. You also have the option to manually enter the credit card number, but the fee Square takes is higher for such transactions, as they’re less secure. In the picture below I’m demonstrating the device while hooked up to my Android device ( DROID 3.) Having this capability means that there is little/no excuse to perform any service or job before you’re paid.
The Square software can track your sales history, issue refunds, and download your transactions into Excel and Quickbooks. Square deposits all the day’s transactions into your linked bank account within 24hrs, or after each day’s transactions.
Related articles on the web
- Mobile Payment Reader Square Coming to Wal-Mart (mashable.com)
There could be a precedent for this, but it still sounds funny that something sold by Apple would also be sold by Wal-Mart. Did anyone actually think when Apple began selling the Square readers earlier this year (http://blog.unibulmerchantservices.com/mobile-payments-start-up-square-teams-up-with-apple) that just a few months later Wal-Mart and Target will follow suit?
Well, good for Square and all signs are that they really have something going for them, but everyone should know that 2.75% for a swiped credit card transaction is not always a good deal. The typical industry rate hovers around 1.75% + $0.20 per transaction or so, often with a $10 monthly fee. So everyone should really do their homework, before selecting a credit card processing provider.
Indeed, 2.75% is not always a good deal. It depends on the volume of your transactions. For the occasional business person it makes better business sense than a high volume business paying 2.75% on each transaction.