Founded by Twitter co-founder Jack Dorsey , Square first appeared at the end of 2009 and launched last year. The company’s product, a small card-swiping device that plugs into the headphone jack on your mobile device, allows users to accept credit card payments via their phone. The idea is that small businesses and individual traders can use this device, coupled with the appropriate iOS or Android application, to rid themselves of those pesky ‘cash only’ signs and allow their customers the convenience of playing with plastic.
This week, Visa added to the $27.5 million Square just raised in new funding and the $66 million in payment volume the company secured in Q1 with an undisclosed amount in a strategic investment. TechCrunch cites COO Keith Raboish as saying Visa’s undisclosed investment will help spread the word about Square to the 27 million U.S. small businesses that currently don’t accept credit cards. The investment will also see a Visa executive become an advisor to Square and lend a certain amount of credibility to the still new product.
At a time when the industry seems to be concentrating on Near Field Communication and making ‘touchless’ payments easier for the consumer, it’s nice to hear about about a technology that helps small businesses up their game. With photo verification and instant, paperless receipts, Square will allow the likes of food cart owners and folks with stalls at farmers market and trade-fairs expand their business. However, if NFC proves to be a big hit and becomes widespread enough for people to consider not carrying their credit cards anymore, Square users could find themselves back at square one. Still, such an event will likely not happen for quite a while, if at all. People would need to see NFC readers at every single store they encountered before they’d consider ditching their card completely.
