First launched in the spring of 2012, people using the Square Wallet application were able to send prepaid “gift cards” electronically to their friends, family, and colleagues for use at any location accepting Square as a method of payment. Recently, the company made the decision to remove the gift card option from their application, a choice that has been met with some scrutiny and criticism.Many people enjoy giving gift cards to their friends and family, especially during the holiday seasons. Gift cards are a great way to allow the person receiving the gift the freedom to choose what items they receive while still keeping up the appearance of being a gift. Many Square Wallet users saw the gift card program as a way to make the application a more viable replacement for cash and plastic cards, yet the executives at Square still decided to pull the plug on the program.
Why Was the Program Discontinued?
While ending gift cards may seem like a step backwards on the surface, a company spokesperson has attempted to shed some light on the topic. The concept of adding the “gift card” option for users of Square Wallet was mainly a marketing tool designed to recruit more Square Wallet users. The concept was that if you sent a gift card to a friend, they would need to download and install Square Wallet in order to claim and “store” their gift card; which seemed like a golden way to get exposure at the time.
However, as more people began sending gift cards to people not yet signed up for Square’s services, there was an onslaught of complaints and refunds needing to be processed as many people felt it was not as transparent as it should be. Many recipients wanted a way to claim their gift card without signing up for Square Wallet, a notion that the design of the system was simply not able to handle. Coupled with fraud and security concerns, Square made the decision to dump the gift card program from their Square Wallet application before they alienated any more potential users.