It’s a hot summer day, you pass by a lemonade stand and you think “An ice-cold lemonade would really hit the spot,” but you have no cash and there are no ATMs in sight! That is no longer a problem thanks to Twitter co-founder Jack Dorsey’s Square, a small credit processing device anyone can use with their mobile devices to accept debit and credit payments on the spot.
Small businesses from corner flower merchants, garage and estate sale holders, or street food vendors and farmers markets can now offer their customers a more convenient way to pay for their goods, allowing them to compete with larger businesses. Square is literally a small square device that can be attached via cable to mobile devices, and which processes credit payments for a small per-transaction fee. Square is currently compatible with Apple products such as the iPhone, iPad, and iPod, as well as Google Android products such as the Droid or Nexus One, and will likely increase compatibility with other devices as the technology catches on. There are no monthly fees and no contracts for those who sign up — just a per transaction cost of 2.5 percent plus $0.15, which Square uses to cover interchange fees to credit card companies. Dorsey claims that, with Square, merchants can see an immediate increase in sales of around 20 percent.
“My goal is to simplify complexity,” said Dorsey in an interview with Charlie Rose. “I just want to build stuff that really simplifies our base human interaction. Twitter was around communication and visualizing what was happening in the world in real-time. Square was allowing everyone to accept the form of payment people have in their pocket today, which is a credit card.”
While Square hit a few bumps in the road in its early days, new customers are streaming in — about 50,000 people sign up for Square each month.
Innovations like this allow small businesses to maximize their competitive advantage, increase variety in market choices, and increase convenience for customers. Three cheers for Jack Dorsey and his Square!