Square introduces new service with lower transaction fee
- Square is introducing a new service, Square Cash, that will allow anyone with a debit card to send money to another person via email or its mobile app.
- The system will allow users to set up payment pages and employ “$cashtags” as user names, giving payers a mnemonic device.
- Square will charge a relatively low 1.5% per transaction to businesses and nonprofits, since debit card transactions are cheaper to process.
Square’s person-to-person payment service Square Cash will soon allow more artists, small businesses, nonprofits, and entrepreneurs to accept card payments. Starting next week, Square Cash will allow anyone to create a username or "$cashtag" and payment page and begin accepting debit card payments.
Nonprofits may be attracted to the simplicity of the system and easy-to-use links; Wikipedia already has a page. Square will charge 1.5% on transactions completed through Square Cash payments, well below the usual 2.75% charged to process credit and debit card transactions through its plug-in reader.
Competitors to Square Cash include PayPal’s Venmo and a forthcoming Facebook Messenger app.