With Square and an iPhone, even a coconut seller could accept credit cards by the side of the road!
While in the United States recently, I came across a small device called Square, which if introduced into Barbados and the Caribbean could transform the way many of our small businesses do business. Not just in tourism, but across most sectors.
The Square device fits into the audio jack of an iPhone, iPod Touch, iPad and android based mobile phones. Rather than the traditional credit and debit card processors with their variable rates, monthly and sometimes hidden charges, Square charges a flat standard 2.75 per cent merchant transaction fee. Previously many factors could influence the discount rate and other fees you pay for the privilege of accepting charge cards, including length of time you have been in business, the type of business, percentage of your sales over the phone and internet, average dollar transaction, total dollar amount of sales per month etc.. Many banks also will not offer merchant accounts directly to small businesses and use third party providers, which can also increase acceptance costs.
With Square, wireless technology enables even the smallest, most remote trader to accept payment electronically and often at a more attractive cost than current dominant processors. From a tourism perspective just think how many more smaller players would be empowered if they were allowed the flexibility and advantage of accepting payment by plastic!
On returning home, I sent the information to a credit union, local bank and one of the major telecommunications providers, hoping they would explore the potential. Sadly, weeks later, only the bank even bothered to respond.
Perhaps the status quo currently protects existing near monopolies and it is not in their interest to drive choice and more competitive ways of doing business.