Compatible with most Android and iOS devices, Square allows merchants and small business owners to collect payments via credit card without traditional payment processing system. The Square device plugs directly into compatible smartphones. Once the device is plugged in, the user opens the Square application and can process credit card payments. Processing a payment involves entering information about how much is going to be charged to the card and then swiping the card through the device. Card data can also be entered manually, increasing the cost of the transaction for the merchant. Customers can sign for their purchases on the screen of the smartphone and can opt to receive a receipt via email.
Square carries no monthly payment processing fees. Instead, a flat commission is taken from each sale. As of February 2013, the commission was 2.75 percent on swiped transactions and 3.5 percent plus 15 cents on transactions entered manually. The fees are taken directly out of the entire transaction and are calculated based on the sale, tax and any tip. Square also offers monthly flat pricing for those business owners who use the device to make a significant number of transactions.
Deposits from Square
All money collected by merchants via Square is deposited into their personal or business checking accounts. The company notes that deposits are generally made on the same business day so long as transactions are completed before 5 p.m. EST. All transactions made after 5 p.m. EST and on weekends are deposited into accounts the next business day. This stress-free form of depositing has made Square very popular with sellers who do not want to hassle with personal checks. However to avoid issues with chargebacks and credit card holds, Square will hold a reserve of the money processed by a merchant that will be released after a waiting period, typically around 60-90 days.
Additional Square Services
Sellers who use Square can access a complete log of their sales from their Android and iOS devices or by logging into their Square accounts online. From the online Square dashboard, merchants can view different statistics and analytical measures. These added features are seen as a particular boon to sellers who want to track analytics without entering sales information into a separate program or platform.
Other Square Products
Square recently introduced Square Wallet, allowing consumers to pay for goods and services via their smartphones without having to take out a credit or debit card. After downloading the Square Wallet application, consumers enter their credit and debit card information into a secure screen. When an individual using Square Wallet wants to pay for a transaction, they simply start up the Square Wallet app and send the payment to the merchant. Only select merchants accept payments via Square Wallet.