Ever since I heard about Square, I was impressed. I was wowed when they used Square to accept payments at WordCampSF 2010 (May 2010). It all just felt right. Swipe the card, email the receipt. The experience felt like making a purchase at an Apple Store with their handheld point-of-sale systems. Square sadly never made it out of the USA and there were rumours that VeriFone and others were going to do similar things. Naysayers claimed security problems (square is magnetic stripe based, rather than chip-based last I used it). Alas, its 2012 and I’ve still not seen anything usable.
So it pleases me to see Swiff in Singapore and the fact that PayPal Here (product page) will also launch in Singapore. Malaysia seems to have SoftSpace. However its April 2012 now and the first reliably available service is Swiff.
Square is upfront with their costs – it basically takes 2.75% of the transaction. That’s considerably higher than the 1.8% charged by Malaysian banks. However it takes away the burden of renting a terminal which can set you back RM130-150/month, with the only option of a refund on that exceeding RM10,000 of transactions per month. And the chances that the terminal accepts “everything” tends to be slim (its usually just Visa/MasterCard). Swiff lacks fixed rates at the moment, and SoftSpace claims to be inundated with queries (but will support more security and have a chip reader).
PayPal might crack this though. They have experience with dealing with banks and banking regulations (Malaysia famously has BAFIA as law). Many tech-savvy people already tend to have a PayPal account (and if they don’t, maybe they’ll start one). They’ve also gone out with a flat 2.7% transaction fee.
I’m looking forward to more competition in this space. It can only lead to lower rates. And with bazaars, conferences, etc. this sort of thing can be very useful.