Square Card (Page 1 of 3)

Eat it. 
People expect it.
Don't give a bad taste while they are walking out the door.
How would you feel, you just had an awesome time and you go to pay the bill, "I'm sorry sir, we'll have to add 3% to your bill because you are using a credit card to pay us."

Agreed.  Currently I tell people I accept cards, but that I reeeeealy rather they pay with a check because I've got a 5% transaction fee.  (which was true last I checked [which was long ago] - squarecard is cheaper)

... everyone so far has been like "oh... yeah, you losing a few hundred bucks isn't worth the 50 airplane miles we'd get using a card... no problem.  We'll just write a check instead."

Am I being greedy and/or foolish?

All that said --- anyone have any experience with this company?  If they are free -- I might just get the little dongle device as a 'just in case' factor.

I've  been investigating them very closely and checking user reports.  There are a couple of negative issues, either only significant depending on the user.

First thing to understand is that this system is not designed for big-time merchant use.  It's designed to allow "everyman" to accept credit cards.   So the kids selling Girl Scout cookies or band chocolate can accept credit cards.  Even your penny ante poker buddies can collect their winnings by credit card. 

That concept carries some benefits and also some compromises.  The major benefit is no contract, no stings, no hidden fees.  The major compromise is that you can't easily accept more than $1,000 in a seven-day period without Square holding the >1,000 amount for 30 days. 

For "everyman,"  that's not a problem at all.  For a serious merchant--even, say, a barber, that's a problem.  Square will raise the limit, but that requires an unstated amount of time building a business history that supports the need, as well as a credit check.

Most of us probably could not easily depend solely on Square, and it only takes a couple of major transactions per month to push Square's per-transaction percentage higher than most of us are paying in monthly merchant account fees plus transaction fees.

But a lot depends on how you do business.  I find that in my portrait business for some reason the vast majority of clients prefer to pay the major part of the fee by check--I don't know why.  About the only time I need to take a credit card is for the intitial booking fee, and then only occasionally. 

I suspect, though, that very shortly--possibly before the end of 2011--we're going to obviate credit cards entirely and move money directly between bank accounts on our smartphones. 

The other issue is customer support.  Again, it's the "everyman" concept--Square's customer support is just about the same as Facebook's and Google's....not much handholding, no personal service representative.  You get it as it is.

Yet, Square is so easy and string-free to implement that it's practically a "why not?" proposition even if you stick with your current merchant.  And I do like the idea of receipts with the customer's picture on them.

The laws are changing - at least in some states http://www.justice.gov/opa/pr/2010/Octo … -1115.html

Maryland is one of them. At least in the states in the court case a merchant can offer a discount or other incentive for not using a credit card or using a cheaper (non-rewards) card. It says nothing about adding the CC fee to the bill - which every MC/Visa/Disc/Amex agreement I've ever seen explicitly states (even though PA itself adds a fee if you pay your taxes using a credit card...)

If you're low volume you don't have any 'cheap' options, just like if you wanted 3 hours of wedding coverage on a saturday in june few of us would give much of a break.

Paypal's terminal entry (so you can type in a cc number) was running $30/month plus 2.9 or 3% plus 35c or so on top of the $30.
Elavon through costco - you must pay the $100 annual exec membership to costco (but you get back 2% of everything you buy at costco and of course it's now a business expense).
The monthly merch fee and online terminal (you can do traditional terminals but you gotta buy them, have a phone line, etc) is $28 - but the 1.9% (and up for rewards cards) comes off that $28 till you exceed it then it adds on top. There is no monthly statement fee, no batch fee, no other fees. And if you do have a terminal and swipe the 1.9% is lower.

You can do some simple math to see what the breakeven point is to move from paypal to elavon. Another difference is paypal IS the merchant, not you, where with elavon YOU are the merchant. If you ever have to deal with a chargeback you will so understand the difference!  Paypal puts the money in your paypal account (sometimes taking 3 days), elavon in your bank account the next day. Paypal can take money out, lock your account and such without notice or much recourse on your part, elavon cannot.
Your local bank can process cards too - but in my case the costs are more (not a lot, but more).

To take amex you can use paypal but if you have your own processing agreement (bank, elavon) then you need a seperate merchant agreement with Amex. I don't have one because amex won't call me back so f'em. I do have to turn away cards at times but amex users all have other cards.

If you get a terminal you can opt to take cards as debit cards and I believe you the merchant pays less of a transaction fee (less risk...less cost).

I used paypal until my volume was sufficient that changing to costco/elavon was cheaper. Most folks still pay with check then CC then cash, but I do more than weddings.

If you expect portrait folks to come in planning to spend $500 and you upsell them to $1000 you have to make it easy for them to pay that $1000 and credit cards do.

That's the best argument - make it easy for them to spend it with you.  As much time as I spend online, Paypal is a no brainer to me, but I have to say, the number who are not familiar with Paypal still surprises me.  If it weren't for the bride's presence at one of last year's weddings, her Dad would not have been comfortable with Paypal.  So there are downsides, no doubt.

Seems like having Square in addition to reg credit card Processing back at the store, would be helpful at an event or location shoot where someone may add to the shoot and pay by CC.  If there's no fees untile used it seems like a no brainer, if you do weddings and they want to add an hour of coverage or something like that.

Kirk and Travis, with your research and use, can you tell us whether the $1000/30 day hold amount is a single payment amount, or is it an accumulated total?  In other words,  if, in the course of a week, you receive a number of $2-300 Square Up payments exceeding $1000, do they put on a hold everything exceeding $1000?  Or do they pay out all of them, since they are each less than $1K?  What about a couple of payments in a single day totaling over $1K?  Or what if a single client's payment was split, say to $600 and $650, totaling $1250, but less than $1000 each?

Obviously for small businesses like most of ours, a 30 day hold on $1000 is a serious interruption of cash flow, and could create difficulties.  There are other ways to accept $1000+ payments, of course, and it does say after a time the hold is removed, but how long does it stay in effect?  Anyone know?

Also, Travis, how quickly does Square Up transfer the more usual payment funds to your bank account?  With Paypal, it's usually about 2 days for example.

On the up side, compared to when I was carrying one of the typical merchant services accounts, with equipment leases and monthly service fees, plus some card fees plus transaction fees, this Square Up thing could actually be less costly, depending upon how much people use their cards.  Obviously there's a tipping point where 2.7% + 15¢ starts to exceed bank charges.  Where I moved from, CC wasn't so common.  Here, it's beginning to seem like the first thing out of the wallet.

Two more upsides, tech people will like the cool factor of the phone scan (and others will fear it), and the 2.7% fee is less than Paypal's 2.9%.  People who fear or misunderstand the tech of a phone scan may also fear Paypal anyway.

Thanks Kirk, for the info.  When they accumulate multiple transactions equaling the $1K in 7 days, do they withhold the entire thousand dollar amount, or only the final transaction and everything over a thou?

Susan and her account happen to be blessed with a bank that will take phoned in, handwritten CC slips which was no longer available with my old bank.  But it's only on Susan's account, so I have to deposit CC to her, then she writes a check to me.  This would circumvent that accounting messiness.  Problem is, in the very short time I've been set up here, there have been two weeks where almost my entire income was in CC totaling $1000 in small transactions, and it would be killer not to have access for 30 days, simply for having gone over the limit. 

That's of concern, though obviously I have access to a clumsy work-around.

I will add that I haven't heard any problems at all about actual money squabbles with Square.

Unless you're a gas station, apparently. 

Somewhere I read 2.7% +15¢ per transaction for Square, and elsewhere today I read 2.3%.  Does anyone know for certain what the charges are?  The more we discuss this, the more appealing it becomes.

In reading the FAQ it appears there may be an opportunity to bump the amount sooner, and provides an email to inquire, which I just did.  We'll see.  Susan has decided she'll pass rather than have amounts above $1000 per week on hold.  I'm hoping to resolve that, but may sign up anyway.