“I don’t have any cash on me” may no longer be a valid excuse with the arrival of credit-card readers that can be used with mobile phones.
In a potential boon to street vendors, mom-and-pop shops and those who just want to lend a few bucks to a friend, several companies have rolled out ways to use cellphones to process credit-card payments instantly.
Square, a brainchild of Twitter Inc. creator Jack Dorsey, enables anyone to accept credit cards using a tiny white attachment and software that can be downloaded to a smart phone.
“The future has arrived,” tweeted Mayer Hawthorne, a singer and songwriter who used Square to sell his CDs and merchandise while on the road.
The plastic card reader plugs into the headphone jack on an iPhone or Android-based phone and interfaces with the phone’s software, then the transaction is processed through Square’s secure servers. Apps for the Palm Pre and BlackBerry are said to be in the pipeline.
After swiping the card through the reader, the buyer signs for the transaction by using finger strokes on the touch screen, then can type in an e-mail address where a digital receipt will be sent. Square charges a fee of 15 cents and 2.75% of the transaction amount to the person processing the credit card. That would amount to 42.5 cents for a $10 purchase.
“People are tickled by signing their names with their fingers,” said Sue Moore, co-founder of Let’s Be Frank, a hot-dog vendor that sets up shop on Glendale Boulevard in Silver Lake every Thursday. The business recently began accepting credit cards for the first time using Square, and Moore said it’s simple to use.
In much the way he launched Twitter, the social-networking site that has grown to more than 100-million users, Dorsey is giving away the Square device. Anyone can sign up for an account at SquareUp.com, and the company will send the device in the mail.
A version of Square for the iPad is also available. It enables store owners to input and track inventory and handle cash transactions, replacing pricey point-of-sale cash registers and terminals.
Those features eventually will make their way into the Square’s cellphone software, Dorsey said.