Square, the latest in the person-to-person (P2P) payments space, is making a splash on the scene. Depicted above, any person with an iPhone can accept credit card payments. This is especially helpful for small business owners who don't want the hassle of investing in any kind of point of sale system.
Does the Square application have legs? Is it a sustainable solution?
I think so! The card processing rates aren't too bad. It's 2.75% + $.15 per transaction, which is slightly less than PayPal's 2.9% + $0.30. Visa and Mastercard's rates are slightly less than Square's, but suffice it to say that Square's rates are at market value. Beyond this, I believe that the convenience of using your iPhone as your payment terminal is highly attractive to artists, shop owners, and other SMB (small to mid-size business) owners - not to mention average people who need a one-off payment.
Look for Square to have growing penetration into payments - it won't get too high, but it will grow its customer base within its niche for the next 3-5 years at least.
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