Targeting these types of cash-only merchants is the benefit that Square brings to the payments market, one analyst says.
“This is exactly where Square is positioned, and they’ve made no bones about the fact that this is where they want to be,” says Todd Ablowitz, president of payment consulting firm Double Diamond Group. “Square is starting to ‘electronify’ payments that have always been cash or check.” Square says it has shipped more than 500,000 card readers to retailers across the country.
In terms of cost, the rate is relatively low, and Square’s service is easy to understand, Ablowitz says.
In February, Square changed its service fee from a 15-cent per-transaction fee to 2.75% of the sale (see story).
Ablowitz also lauds that folks who want to accept credit cards for payment do not need a merchant account, only their own bank account to receive the payments. “Square took a page out of the PayPal book and brought it to the face-to-face payment market,” he says.
Payments Source, September 1, 2011
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