Anyone who has been using the popular mobile payment app Square Register is likely familiar with the higher fees associated with manually typing in a credit card number rather than swiping it through their free credit card reader. Instead of a mere 2.75% fee, you used to be charged an additional surcharge for the risk they take of not having the customer’s signature. This was among the few restrictions that Square users were dealing with since the company’s inception, but luckily they’re headed for a fairly drastic change.Very recently, Square made the announcement that they were no longer going to enforce deposit limits or holds on credit card transactions that were complete by typing it in manually rather than swiping. The biggest benefit here is that the funds accepted by a user through the app will be deposited within two days regardless of how the card information was entered, which is great news if you have ever had a credit card that didn’t want to go through the credit card swiper.
However, while many merchant who use the award-winning payment platform rejoice at the new lax point of view, some skeptics assert that there will be an increased risk of fraud and that the company may be exposing themselves to unnecessary risk with this new policy. Those skeptics cite the fact that Square put the original policy in place for a reason, thus there must have been evidence that fraud was a possibility if those safeguards were not instilled.
Nevertheless, Square is sticking to its guns and claiming the move as a victory for small businesses that rely on their service and can now maintain a much simpler cash flow. This is vital not only to merchants but also to Square as competition in the mobile payment market starts to heat up with new ideas and intuitive designs throughout every niche of commerce. Though Square processes over $15 billion in payments each year already, there is certainly room for growth and the added risk can easily be paid for with the increased demand that they are likely to receive because of these policy changes.