Forget Interac, go mobile with Square

I was standing in front the Me.N.u food truck recently watching as a woman placed her order for the rice ball and taco combo. She was about to pay when the staffer said, “We take credit cards” much to her delight. She passed over her credit card and he swiped it through a small, white square, maybe one inch square plugged into a tablet and passed it to her to enter her PIN.

That small square is called a Square Reader and it’s one of the mobile payment devices giving Interac some competition in the small business section, not only for ease of use but for costs.

Ms. Cynthia Burrows, a register massage therapist, has tried different mobile payment services and chose Square.

“A colleague was using Square and told me about the system. I was excited but a little skeptical though because I could by pass the bank and Moneris system I was using, pay a flat rate and have deposits made within a couple of days using just my phone or IPad,” she says. The device was free, very user friendly, had simple interface and easy to set up. My skepticism was the idea that I could do this without having to go through a bank.”

What is a Square reader? Like it says on the tin, it’s a credit card reader that plugs into a mobile device, whether a phone or a tablet. It works on iOs and Android platforms and plugs into the headset jack. It sends receipts via email or text. Card information is encrypted and it doesn’t store data (yours or your customers’) on the device. It also charges 2.75 per cent per swipe for all major credit cards. Interac, which is the predominant mobile payment system, has acquirer services fees that range from $0.015 to $0.76 and pre-determined fees as defined by acquiring members, but unlike Square, Interac offers both debit and credit payments.

Dan Farris, vice president and co-owner of Toronto Harbour Tours switched to Square because he was dissatisfied with his previous system (he declined to name which one). The company needed a system that could track the different products they sell as well as tracking sales for commission purposes. He found that their previous system was complicated, outdated, more expensive and according to him, “the fee structure was completely impossible to understand.”

Square isn’t the only mobile payment service available for small businesses in Canada and as Mr. Farris points out, it also not the cheapest. There’s Intuit GoPayment, PAYD and PAYDPro, all offering mobility and low fees but Square is making a dent in the  Canadian small business market with 20 per cent of small businesses using it.

Colleen Murray, part of the Canadian communications team for Square, explains the appeal of Square. “Square eliminated the cost barrier that many businesses face when it comes to accepting credit. By offering a free card reader, free software, and affordable processing rates with no hidden fees or contracts, Square provides an invaluable service for businesses that don’t have money to spend on expensive hardware and high transaction costs.”
It currently doesn’t accept debit cards in Canada but Ms. Murray says that the team is working to ensure that Square accepts all forms of payment.

But for Mr. Farris and Ms. Burrows, Square fulfills their business needs.
“I find Square is reliable. Their customer service has been quick and helpful, the one time I needed to contact someone. It’s the simplicity that appeals to me. I am a bit tech savvy but one doesn’t have to be to use the system,” says Ms. Burrows. “It has made my business more efficient as I no longer have to call numbers in. It’s safer as I don’t keep clients’ numbers any longer. I was using a very old fashioned machine and had to call in the transactions to the bank. Did I mention the simplicity?”

Mr. Farris thinks that Square offers a stylish component to their business. “We have found that using Square impresses the customer a little bit.  The fact that we run sales on an iPad often gets a nice comment from the customer, and I believe makes us look like a progressive company.”