Earlier this week, Starbucks and Square announced a partnership. This was big news for the future of mobile payments. While Square has been around for about two years now, it is mostly used by small independent business owners. Partnering with Starbucks means that the Square mobile payment technology will now be exposed to more people and larger retailers may start using Square based on the learnings from Starbucks. And Starbucks has had mobile payments for a while, but it is linked to a Starbucks account that you have to reload with money to spend, making it a bit limited (though super easy and fun to use; I love it). The partnership signifies a big move towards major businesses adopting mobile payments:
“Though smartphone payments have a long way to go before they replace wallets altogether, Starbucks’s adoption of Square will catapult the start-up’s technology onto street corners nationwide, and is the clearest sign yet that mobile payments could become mainstream.” – New York Times
What is Square and how does it work?
Square is a mobile payment technology with two branches: one for business owners and one for consumers. The business owner can download the Square software to their iPhone or iPad, request a Square device from Square to plug into the top of their iPhone or iPad, then accept payments by swiping cards through the device. Or, if a customer is also using Square for payments, the business owner can see the customer through the Square software and allow the customer to pay just by saying their name. For the consumer, it is just a matter of downloading the Square app and linking a bank account or credit card to the app. It is much like PayPal, except mobile.
Why is a cashless society a big deal?
According to The Atlantic:
“(1) Innovations that save time, even just a little bit of time, are real innovations, because in any advanced economy time and attention are currency and creating more of them can make us all richer; (2) What’s important about Square isn’t just the transactions it makes more efficient but also the cashless world it pulls closer to the present. As Slate investigated in a fabulous series, a cashless society can make us richer, healthier (dollar bills are dirty!), and smarter.”
I am looking forward to more efficiency in payments and not having to carry around anything but my phone.
I did an interview with KATV this morning talking about the Square and Starbucks partnership. I’ll post the video as soon as it becomes available.