We find ourselves in the middle of one of the greatest wealth transfer periods of all time. Those with wealth must decide whether they want to make transfers, and if they do, they must decide how much, to whom, when and in what structure?
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The owners of small boutiques, restaurants, food trucks and even stalls at farmers’ markets are facing that quandary. Carrying paper money is a thing of the past for a growing number of customers, but accommodating them requires that businesses accept credit and debit cards.
Typically, that means getting a point-of-sale terminal from a company such as VeriFone or NCR and having to deal with the assorted costs and swipe fees from a credit card company. But new apps and devices for mobile phones are changing that.
The platform emerging as one of the most popular with Boulder-area businesses is called Square, which is developed by San Francisco-based Square Inc.
Square’s most visible product is the Square Card Reader, a small device that enables iPhones, iPads and Android devices to accept credit cards.
As the name suggests, the device is a plastic square about the size of a key chain. It works by plugging it in to the headphone jack of a tablet or smartphone. Paired with Square’s app, it allows anyone to run credit cards within minutes of installation.
Square’s little readers increasingly are becoming prominent around Boulder, particularly around farmers’ markets, said Matt Aboussie, owner of Wild Alaska Salmon LLC. His company sells wild-caught salmon online, to retailers including Alfalfa’s and at farmers’ markets.
Aboussie needs a mobile payment platform to sell to walk-up customers, and it also helps to be able to take credit cards when doing deliveries. He tried other systems, but they were buggy and the fees were “completely outrageous.”
He switched to Square and hasn’t looked back.
“It’s a must have for me. It’s super polished and smooth to operate,” Aboussie said. “My employees can just log in and start running cards.”
With a Square Card Reader, a clerk types in the amount to be charged on the device’s touchscreen. The purchaser uses his or her finger to “sign” the virtual receipt on the screen, and the app can send a real receipt by email.
The more advanced version is Square Register, which works with the iPad and is a more robust point-of-sale system. Prices can be preloaded into the system, which tracks inventory, provides sales analytics and connects to a receipt printer and cash drawer.
Square is carving out a niche, in part because the company gives away readers. Square makes its money by charging 2.75 percent per swipe and can be used with Visa, MasterCard, American Express and Discover.
The low cost is making a difference, said Shannon Aten, owner of the Tasterie Truck, a food truck that sells pastries and desserts.
“I honestly think it’s changed the way food trucks or mobile businesses can do business. The old systems were clunky and expensive and not practical for our purposes,” Aten said. “It makes us more profitable, honestly.”
About 1,000 Boulder-area businesses use Square, according to spokeswoman Lindsay Wiese. Boulder is one of the company’s best markets, coming in the top five in the country on a per capita basis, Wiese said.
Square has emerged as the top name in mobile payments, in part because of the recent announcement that Starbucks will start using Square apps at its 7,000 stores this fall. But it won’t have the field to itself.
Google and Microsoft are developing payment systems, and VeriFone and NCR have designed readers that can be added to smartphones and tablets.
Google and Microsoft are taking a different approach to mobile payments, developing mobile wallets that rely on the wireless capabilities of smartphones. In theory, they will allow consumers to get rid of “traditional” wallets.
They work by storing consumers’ credit card information and transmitting it to retailers using near field communication technology. NFC-enabled smartphones require retailers to install small receivers to get the signal from customers.
Google Wallet is out and can be used at retailers with the MasterCard PayPass system. Microsoft reportedly is launching its wallet this fall.