MacDirectory Magazine

Mads Hindhede Svanegaard

MacDirectory magazine is the premiere creative lifestyle magazine for Apple enthusiasts featuring interviews, in-depth tech reviews, Apple news, insights, latest Apple patents, apps, market analysis, entertainment and more.

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Page 29 of 133

Despite Early Hesitation, Square Embraces Tap to Pay on iPhone Feature By Jesse Hollington As the old saying goes, “if you can’t beat ‘em, join ‘em.” That appears to be precisely what Square is set to do as Apple prepares to roll out its cool new Tap to Pay on iPhone feature this year. Long before Apple Pay, Square pioneered the idea of a simple mobile payment system for the iPhone, practically giving away portable mag-stripe readers that connected to an iPhone’s headphone jack. Small businesses and independent sellers could quickly sign up for a merchant account through Square’s iPhone app and be ready to accept credit and debit card payments in no time. As payment technologies advanced, so did Square’s solutions. A Lightning version eventually superseded the 3.5mm mag-stripe reader to make up for the removal of the headphone jack on the iPhone 7, and Square also began selling a slightly more expensive Bluetooth device that could accept both contactless tap payments and chip cards. Square’s point-of-sale (POS) solutions became so widely embraced by small retailers that the company even began offering a variety of accessories such as iPhone cases and iPad mounts to help folks use Square’s card readers to create mobile and countertop POS terminals. When Apple announced Tap to Pay on iPhone earlier this year, it seemed poised to upend Square’s business model. By leveraging the NFC chips already found in modern iPhones, there’s no need for a card reader — at least not for contactless transactions. The iPhone can do the entire job on its own, and Apple is taking steps to make that a reality. Tap to Pay on iPhone launched with high-profile partners like Stripe and Shopify on board. Many questioned where Square would fit into this equation, but the company has remained pretty quiet about it until today. However, in a press release, Square has officially announced that it will bring Tap to Pay on iPhone to Square Sellers later this year, and it’s even launching an Early Access Program for those interested in trying it out sooner. The company says it’s already been working with Apple to enable the feature in its Square Point of Sale app, where it looks like it will work just like it does with a Square hardware device. Despite Square’s longstanding foothold in the mobile POS market, it shouldn’t come as a surprise that it’s embracing Apple’s Tap to Pay on iPhone, as there’s really no downside. Even though Square sells hardware, that’s not ultimately where it’s making its money. Consider that Square used to give away the mag-stripe readers for free; even those sold in stores would provide a credit equal to the purchase price once you started using it. Square makes its money on the merchant fees it gets to shave off every transaction — 2.6 percent of the amount plus a flat $0.10 fee for every tapped card and even more for “card-not-present” transactions. Further, Apple’s Tap to Pay on iPhone is limited to contactless payments. Businesses that need to handle physical cards, such as for larger transactions, will still need to pick up Square’s hardware reader to handle chip-based payments. Sellers who sign up for Square’s Early Access Program in the U.S. will be able to begin testing Tap to Pay on iPhone this summer. The feature will open to all U.S.-based Square customers later this year. Meanwhile, Apple has already begun rolling out the feature in its own retail stores to “dogfood” the technology. Other partners are also working behind the scenes to trial it in more stores. While it may not fully launch until iOS 16 arrives this fall, it looks like most of the pieces are already in place in iOS 15.5.

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