Payments players are tripping over themselves going after small business accounts, especially to handle in-store POS transactions. PayPal just introduced Zettle as a POS card reader aimed at small merchants. Many of PayPal’s over 25 million merchant customers also have an in-store presence. This expands PayPal’s suite of services that it offers and rounds out its acceptance of payments across all sales channels.
Not surprisingly, other firms are targeting POS transactions as well. Shopify also took this step by introducing POS terminals since many merchants on its marketplace platform had physical stores as well. Another example is GoDaddy just launching a POS solution through its Poynt acquisition. The POS space will become more competitive than ever as Zettle goes up against leading market players Clover and Square. Small merchants will benefit as more payments vendors will aggressively fight for their business.
The following excerpt from a Wall St. Journal article reports more on the topic:
Digital payments players are going to be competing hard for small businesses as they emerge from the hardships of the pandemic with new ways of selling. It just isn’t clear what game they will be playing.
On Wednesday, PayPal Holdings said it was bringing its Zettle product to the U.S. It will offer point-of-sale hardware and related services such as invoicing to the likes of U.S. coffee shops and other small to medium-size physical merchants and likely will compete with what Square, Fiserv’s Clover and others have been offering. And it isn’t a small market: Bernstein analyst Harshita Rawat estimates that sales by merchants under $100 million in annualized sales are a $4 trillion market with hundreds of legacy payments providers.
But in the same way that PayPal is aiming to take a bigger chunk in-store, rival Square has been pushing hard to do even more out-of-store via its own online payments and web-building products. It also is more heavily deploying its popular Cash App into the business and payments realm.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group
