Square responds to ‘tap and pay’ criticism with a new system for small business

Square contactless reader. Image: supplied

Payment tech company Square has addressed the biggest criticism of its Australian launch back in March.

When Square arrived in Australia, it was offering a small $19 device that plugs into the headphone jack of a smartphone or tablet and can read debit and credit cards for a 1.9% merchant fee. The tech company hailed it as a breakthrough for local small businesses.

However, Business Insider reported then that the lack of “tap and pay” capabilities was a notable omission, with so many Aussie customers used to fast, contactless transactions.

In response, Square today unleashed a new $59 device that solves the problem.

“We know NFC is important to Australian businesses, both for providing fast and secure tap-and-go card payments, and future proofing for the next wave of payment innovation like Apple Pay and Android Pay,” said Square’s Australian country manager, Ben Pfisterer.

“We’re delivering it in the most accessible, affordable and mobile way, available anywhere in Australia.”

For the moment, merchants can order the Square contactless card reader online directly from the vendor, with free shipping. Square announced that the product would be released through retailers in “the near future”, including Officeworks, Apple, Optus and Harvey Norman.

Pfisterer told Business Insider that Square gives out the card reader to any business, regardless of its size, that pays the once-off fee — allowing the customer to immediately sell its products to customers.

“If you go to a bank for card [capabilities], you get judged. They’ll go through your history and would be more reluctant to give small businesses a go,” he said. “The Big Four banks are incredibly powerful in the market… but we don’t think you should be disadvantaged as a small business.”

Square has claimed success for its initial $19 device since the March launch, citing that 80% of its Australian customers had not accepted credit or debit cards before signing up with them.

Twitter co-founder and CEO Jack Dorsey also founded and runs Square. In the United States, the company made headlines in 2013 for prohibiting firearms sales through its equipment.