A few people have been making waves in the payment industry recently. Companies such as Square, PayPal and Mpowa and concepts such as Bitcoin (more on that in another post) have been turning the world of online and off-line payments, and even the concept of money on its head.
Square is a U.S. based company founded by Jack Dorsey one of the co-founders of Twitter and is attempting to lower the barrier of entry for taking credit card payments. A simple free "square", about the size of a boiled sweet, gets plugged into your iPhone and can turn it into a credit card payment device to allow you to take payments via your phone wherever you are. This is a harsh contrast to Mastercard or Visa's expensive devices required by businesses in the UK today to take card payments.
Over in the UK, PayPal and new company MPower are launching similar App / Hardware backed schemes allowing anyone who owns a smartphone to become a credit card merchant. In the US Square now takes $10 Billion annually and has begun to revolutionised card payment. You can pick up a Square in a high street store, for around £6 (which you get back when you sign up) and people carry square devices around with them using them to split bills in restaurants or lend money to friends, even though there is a reasonably high 2.7% charge.
This move towards simple, accessible card payment is changing the way we do business. It's removing the monopoly around card technology, and removing the high startup costs, allowing people to set up a retail operation within a matter of minutes And capitalise on a new trend or a craze or meme. It's increasing competition, allowing people to stand outside shops and take payment on the pavement.
It's fascinating that even a few short years ago payment and all the legislation and security surrounding it could quite easily have been perceived as one of the last areas that would fall to the new wave of disruptive mobile technologies yet here we are, and it's crashing down around our ears.
It's also a testament to the power of the App. What was perceived as simple software a couple of years ago, now with the addition of a small piece of free hardware changes your phone into a completely different device.
Your smartphone can already be augmented to become a heart rate monitor, blood pressure monitor, pedometer, payment terminal, barcode scanner...