Square’s New Rival Is Paypal Here

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Pay palSmall business technology was revolutionized first by Paypal then by Square and now by Paypal Here. If you are more familiar with Paypal than Square, that?s okay by Paypal. They are counting on name recognition as they make a play for Square?s market share.

This new development shows that a major innovation is underway in small business retailing. In 2009, Square introduced a small card reader that works with either its Android or iOS app. New in 2012, Paypal Here is offering a similar credit card reader. The triangular Paypal Here reader works with iOS and is expanding to Android soon. Like Square, it is thumb-sized for the ultimate portability.

Head-to-head competition is bringing down the price but only slightly. While Square charges 2.75 percent for each transaction, Paypal Here is charging 2.7 percent. Price is not really an issue for many entrepreneurs, however. Small businesses can make money by providing customers with technology-smart, fast payment methods thus increasing sales without expensive equipment and other overhead. The real savings is the ability to go after more sales through increased ability to take credit cards. This helps level the playing field for small businesses and entrepreneurs in the way that Paypal once did online.

The Paypal Here technology includes a blue reader and an accompanying app. It allows users to process credit cards, and it allows the seller to document cards and checks via the device?s camera. Of course, it also allows sellers to utilize PayPal accounts to pay for goods and services.

Paypal has brand recognition, having been the go-between for online entrepreneurs. From the early days of Paypal, small businesses have benefited from the transaction safety and ease of transaction that Paypal offered to customers. Paypal has benefited, too, becoming the dominant go-between. It has grown with the addition of its own credit cards and other services. It?s only natural that the company would develop its own rival to Square.

By all reports, Square is successful, even if it isn?t a household name yet. In three short years, Square has been adopted by millions who do business in person. The Obama re-election campaign uses Square to process donations. More than a million merchants use its platform every day. In fact, Square has moved past the small business front to encompass agreements with some of the biggest names in retail: Apple, Best Buy, Target and Wal-Mart.

Thumb-sized readers that work with existing technology eliminate significant obstacles to small business. This puts the ability to transact sales in the hands of the individual instead of just the corporation, and that is exactly what Paypal was already doing online. With Square technology, and now Paypal Here, credit card sales can be easily and swiftly conducted at the weekend art show, by the roadside fruit stand and every other legal enterprise on the planet.

Rivaling the rivals, Google, Isis and Paypal itself are expanding digital ‘wallet’ platforms. Hopefully, more competition among pay systems will keep the innovations flowing.

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