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San Francisco (ip-192.com): Do you have an iPhone? Do you like Twitter? If your answer is yes, you may like Square. Square is a small plastic magnetic card reader that hooks into the headphone jack of any iPhone or iPod Touch and turns it into a credit card payment system. Android and Blackberry apps are in development, and computer software will be available later, according to the Los Angeles Times.
Jack Dorsey, an American software architect and businessperson best known as one of the founders of Twitter, started selling the new product through a website. The system is designed for many types of businesses including storefront owners, street vendors, and even part-time flea market salespeople, according to the website. Customers don't have to have the Square gadget or app to pay. They only need a credit card and an e-mail address to receive a receipt. Dorsey plans to give the hardware and software needed away for free (however, there is no information on transaction fees.)
When a credit card is swiped through the device, it converts the card information into an audio signal, which is then processed by Square's software application on the device, encrypted and transmitted to Square's servers via a Wi-Fi or 3G connection. Vendors need to establish a profile that is tied to a bank account, a system already proven by companies like PayPal.
The payment system is secure, so Dorsey, since all data is encrypted and the credit card information is not stored on the device. After establishing a profile, users can set their photos to display on the vendor's screen to thwart identity thieves. The e-mail address a customer needs to provide during a sale is invisible to the seller and only used to transmit the digital receipt.
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