Company offers a new way to swipe

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Alexi Bullock wakes up every morning to the alarm blaring on her iPhone. After tapping the snooze once, she catches a few final minutes of sleep. When the alarm chimes the second time, she picks up her phone and reads emails from the previous night and catches up on any texts she may have missed. Depending on her mood, music blares from her iTunes or Pandora apps, while she gets ready. Before she heads out the door, Bullock pulls up Google maps to double-check her route to the subway on her way to her summer internship in New York.”I really would die without my iPhone,” said Bullock, a senior from Sandy working toward a BFA in graphic design. “It helps me get from point A to point B when I’m in this huge city where I don’t know where anything is.”

Bullock expected things to be a little bit different in the Big Apple, and they are. When she needed to run an errand for her internship, she was surprised when she didn’t pay at the register.

“He asked me for my credit card and just swiped it through this little box on the top of his iPhone, right there in the middle of the store,” she said. “It was the coolest thing.”

That little box was a new technology from Square, a rapidly expanding company based out of San Francisco, created by Jack Dorsey and Jim McKelvey.

In February 2009, McKelvey, a glass artist in St. Louis, lost a big sale. A potential buyer only had a credit card, which McKelvey didn’t have a way to accept. McKelvey was later speaking on the phone with his friend Dorsey in San Francisco and recounted how disappointing it was that he was unable to sell the $2,ooo piece of glass.

“Both of them realized that here they were, in cities thousands of miles away from one another, talking on a phone, essentially a general purpose computer, and yet they couldn’t accept payments with that same device,” said Lindsay Wiese, public relations coordinator for Square, in an email. “They realized that if the phone could have accepted cards, Jim could have saved the sale, and the idea of Square grew from there.”

Bullock sees the potential in Square with her floral and graphic design ventures.

“Square really is an amazing product for new up-and-coming businesses,” Bullock said. “It would be so nice to use a credit card right there instead of asking for PayPal, cash or check.”

Square seeks to simplify the complexities surrounding credit card processing.

“The majority of Americans carry credit cards, but individuals have traditionally been unable to accept them,” Wiese said. “We are rethinking the entire buyer-seller experience and making it more memorable and enjoyable for both customers and business owners.”

Square is a free application that allows users to accept credit cards on their smart phones by either swiping the card though the Square device or by manually entering the information. Users are charged a 2.75 percent per transaction fee, with no additional cost to buyers or sellers. Instead of using paper receipts, customers seamlessly receive a text or email receipt detailing their purchase.

Kelin Crane, a recent graduate from Oakley, Calif., uses a Square credit card reader at Mobile Auto Care.

“As a mobile repair company, we need the capacity to charge people where we serve them,” Crane said. “Some credit card companies offer less desirable options that are high maintenance, have complicated fee structures and clunky hardware. Square has solved many of our problems, simplified our financial transactions and made it affordable for our business to stay mobile.”

Crane could not be happier with the product.

“Nobody else does a free account with one flat fee,” he said. “It’s just so simple. You get it, plug it in and go. It solves the problem of receiving payment in a digital world without adding new ones.”

In a recent interview with CNN Tech, Dorsey explained the goals of his company.

“We want to make paying with your credit card even more magical,” he said. “We want to take away all of this clutter, all of the paper, all of the mess.”

Square is currently only available in the U.S. and has shipped more than 500,000 readers. Square says users have made one million purchases, an average of just two per reader, that account for more than $1 billion in gross payment. Square credit card readers are free and can be requested at squareup.com.

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