Mobile payment company Square launches contactless system in Australia

A NEW payment system launching today is aimed at micro businesses who want to be able to use contactless transactions without bank fees.

AUSTRALIANS are now going to be able to use tap-and-go payments in an even wider range of places with a new system launching today offering an easy solution for micro businesses to jump on-board.

Australia leads the world in the take-up of contactless payment with about 70 to 80 per cent of Mastercard and Visa payments contactless, although the switch to the convenience of tap and go has come at a price for some.

The Australian Payments Clearing Association’s recent report revealed a credit card fraud was on the rise in the past 12 months.

South Australian police this month warned of the rise in thefts involving tap and pay cards, with outdoor diners and drinkers frequent targets and about 40 per cent of those stolen cards used to make tap-and-go purchases.

Mobile payment company Square has chosen Australia as the first country outside of the United States to launch its contactless and chip card reader today.

Square country manager Ben Pfisterer said a trial of the new Square device launched today had an even greater response, with about 85 per cent of transactions contactless showing the “insatiable desire” for the system.

Mr Pfisterer said Square contactless payment device offered peace of mind for businesses and consumers.

“(It) safely encrypts every transaction, combined with real-time fraud protection, offering Square sellers unparalleled security,” he said.

Square is led by Twitter founder Jack Dorsey and lets businesses set up an off-the-shelf payment system that doesn’t require filling in a bank application form or paying an ongoing service fee.

Using Square involves a one-off purchase of the device and then the business owner pays 1.9 per cent in fees for each transaction. For a transaction of $100, the business owner gets $98.10 in their bank account, with payments taking about one or two days.

Square launched in Australia in March with a Square device costing $19 that worked with both the magnetic stripe on a card and the chip. The new Square device launching today costs $59 and works with contactless payment and chip cards.

Mr Pfisterer said small and micro businesses had been forgotten about for a long time, with the hurdles of ongoing fees of payment systems being a challenge for someone starting out.

He said internal research showed that about 80 per cent of Australian businesses which had taken up the Square payment system previously had not used other card payment systems.

To use the first generation Square reader, you need to connect it to your device by plugging it into the audio jack of a smartphone or tablet, or in the case of the new iPhone 7 into the Lightning port using an adaptor.

The new Square device launched today, which is 6.6cm square, connects to a smartphone or tablet through Bluetooth, and accepts contactless payment systems using Visa, Mastercard and American Express and mobile payment systems such as Apple Pay.

The unit has a battery needs to be charged daily through USB with typical use or it can be used on a dock connected to power.

Square is going up against bank terminals owned by the big four banks in Australia but Mr Pfisterer said it had sold thousands of the first-generation Square units in Australia in the first few months.

The Square units are available today online and will be availabe soon through retailers including Apple, Officeworks, Optus and Harvey Norman.

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