Apple's wallet replacement, Apple Pay, will make you want to cut up your credit cards, but it won't destroy credit card reader Square. At least, that's what Square founder Jack Dorsey says.
A few years ago, Square tried to replace your wallet too, with an app it called Wallet. Square Wallet let you store your credit card info and then pay for items simply by saying your name. It worked seamlessly with the company's existing Register app for businesses, so they would see that a Square Wallet customer had entered the store. Wallet could check you in to a store when you walked in. It seemed destined for greatness.
But mobile payments have been slow to take off, as Android users have seen with the lack of support for their phones' built-in NFC, or near-field communication, functionality. Square folded Wallet earlier this year. Apple Pay could change everything by encouraging the mass use of NFC payments, a shift that would make Square's free card reader for businesses a relic of the way things used to be.
But Dorsey isn't concerned that Square's mobile payment products hit too early to be successful. The Twitter co-founder tweeted Tuesday night that Square will be compatible with Apple Pay.
Square has been building mobile payment products for the last five years. Its card reader, which businesses plug into their iPhone headphone jack, is ubiquitous--just head to your nearest coffee shop or food truck to see it in action. The company has developed a full point-of-sale system for businesses, but is also trying to make it easier for you to pay for stuff with your phone. Square has a Venmo-like app, Square Cash, that lets you send money to friends, and its new food ordering app, Order, is taking aim at Seamless. You currently have to pick up the food you order from nearby restaurants, but the company recently acquired high-end food delivery start-up Caviar and is expected to expand into food delivery itself. Clearly Wallet's failure doesn't mean Square has ditched mobile payments altogether.
Presumably Square will add NFC to its terminals, but the company is also preparing to ship a new Square Reader for chip-and-pin credit cards as the U.S. prepares to adopt the EMV standard by next October. Financial blog BankInnovation noted that new EMV terminals are equipped with NFC, which will make the switch an easy one, but that Square might rely on Bluetooth instead to accommodate Apple Pay users--or a mix of the two technologies.
Either way, Square isn't dead. It's adapting. Maybe it can adapt its way into the open arms of an Apple competitor. Google, you listening?