In the world of free person to person payments, a rationalquestion is how can this be sustainable? With more than a million small business establishments this articlein Tech Times indicates that Square will monetize its P2P by enablingbusinesses to also accept these payments for a fee:
“Squarecredit card readers attached to phones and tablets have made it easy for smallbusinesses to accept payments. Now the company is offering peer-to-peer onlinepayments for businesses through Square Cash.
SquareCash allows businesses to accept debit card payments through a “$Cashtag,”which is a handle and web page that individuals or companies can use to makepayments. There is no charge for the sender, but the company receiving the cashhas to cover a 1.5 percent fee.
The1.5 percent fee is significantly lower than the two or three percent typicallycharged by banks for processing credit and debit transactions. Square’s creditcard readers are already far more affordable than costly credit card readersissued by banks, but they still take 2.75 percent of each transaction.”
The implementation as a $CashTag would seem compelling forits target audience:
“Each$Cashtag has a unique URL with its own webpage that acts as a virtual cashregister for the company. All that’s needed to make a payment is the $Cashtag,which can be a username of your choosing, preceded by a dollar sign.
Theclever tags will make it simple to add payment details to a business card orshort ad in the same way that Twitter handles work. It also allows you toreceive payments without giving away personal details like your name or bankinformation.
Theother big advantage over the likes of Venmo is that you don’t need to berunning the Square Cash app to make the payment — you can do it directly from awebpage, which significantly reduces the entry barriers for new users.”
This makes for a very easy mechanism by which consumers cansend payments to a business, perhaps the $Cashtags will start to show up onstreet vendor signs. The more people seethe $Cashtag advertised the more adoption it will drive. This might be a hit!
Overview by Tim Sloane, VP Payment Innovation for Mercator Advisory Group
Read full story at Tech Times