Payments company Square has today launched its contactless and chip card reader into Australia, the first market outside the US to welcome the device.
Setting merchants back $59, with payment processing fees to remain at 1.9 percent, the device allows customers to insert their chip card or hold their near field communication (NFC)-enabled card or device up to the reader to tap and go. The reader connects to the seller’s smartphone via Bluetooth.
Ben Pfisterer, Square’s Australian country manager, said it has been “humbling” to see the uptake the company has had since first launching locally with its Register point of sale app two years ago. After opening a local office in 2015, it then launched its $19 magnetic stripe card reader earlier this year.
This approach was determined by the market, with Pfisterer explaining the company spent time talking to small businesses to see what it is they wanted.
“We kept hearing this recurring theme, that they love contactless and it’s really prevalent in the Australian market, but the really important things for them are accessibility in terms of price point and mobility, so they kept saying to us, why can’t we have that device we keep seeing in the US first?” Pfisterer said.
“We deployed the first reader and it was well received, and it’s not about reaching any stage or point in our development, but we didn’t want to confuse the market with a bit of a shotgun approach with all the different products, we wanted to create a long-term funnel for products to launch.”
According to Pfisterer, there are “thousands” of small businesses across Australia using Square, with this growth aided by retail partnerships with chains including Harvey Norman and Officeworks, and integration with various accounting and inventory management apps.
The company is competing against the likes of PayPal and MYOB, which in July launched PayDirect Online, a new card reader and online payment processing solution to help sole traders and small businesses get paid on the go. The MYOB device accepts magnetic stripe, chip, and contactless cards and devices.
However, Square believes it is attracting an untapped market: the company reports that up to 80 percent of its local sellers had not accepted credit or debit card payments before using a Square reader. Despite this, Pfisterer believes that “small businesses in Australia are some of the most vibrant and entrepreneurial you’ll find anywhere in the world”.
He explained, “Even though Australia’s the most recent market, it’s also seen as a really advanced market not only from a small business perspective, and we know Australian businesses are some of the most tech-savvy there are with a great uptake of new tech, cloud-based systems, but also from a payments innovation perspective.
“There’s a mutual relationship where we get to leverage some of the amazing talent they have in the US office but we get to act globally and look at the most advanced markets like Australia, so some of the things we’re testing and deploying here can be deployed into our other markets.”
Among the other Square products that could soon be making their way down under is Square Capital, the company’s small business lending service.
Image: Ben Pfisterer. Source: Supplied.