![Square's new reader takes contactless payments in the front, chip in the back, but no magswipe. It communicates with POS software on a phone or tablet wirelessly. Photo: Square Square's new reader takes contactless payments in the front, chip in the back, but no magswipe. It communicates with POS software on a phone or tablet wirelessly. Photo: Square](/images/transform/v1/crop/frm/silverstone-feed-data/73c22c99-d729-4dac-aaa8-8d66f36b17b1.jpg/r0_0_727_410_w1200_h678_fmax.jpg)
As Australia's big banks hold out against Apple Pay, Square is helping more small businesses accept your money with a wave of your phone or credit card — sometimes before you even reach the counter.
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Square's $59 contactless card reader goes on sale in Australia today — the first country outside the US — supporting tap-and-go payments such Apple Pay, Android Pay and Samsung Pay, along with contactless credit cards from Visa and MasterCard. The card reader can also process chip-and-pin transactions but not older magswipe transactions which are being phased out in Australia.
The palm-sized card reader is designed to connect with a retailer's Apple or Android device via Bluetooth, processing card payments over the internet in real time to eliminate the need for a traditional EFTPOS terminal. Targeting small business owners, Square charges a small percentage of each transaction but doesn't charge any other fees apart from the upfront cost of the reader.
Rather than remaining tied to the counter, the battery-powered card reader is small enough for staff to carry in their pocket, working at markets, festivals and pop-up stores or perhaps roaming retail stores to offer faster service, says Square's Australian country manager Ben Pfisterer.
"Retail queue busting is certainly becoming more common thanks to the speed and convenience of contactless payments, with staff able to stand at the door or walk along a queue of shoppers to process payments on the spot," Pfisterer says.
"Restaurants and cafes also use Square for table service — every waiter and waitress can keep a Square reader in their pocket so they don't need to worry about lugging clunky and fragile traditional payment terminals from table to table."
While contactless payments are still finding their feet in the US, driven by the launch of Apple Pay in 2014, Australia is one of the world's fastest adopters of the technology. Around 70 to 80 per cent of Australian over-the-counter card transactions are now contactless, Pfisterer says.
Square will continue to offer its original card reader in Australia, which supports chip-and-pin and magswipe payments. The reader connects to a smartphone or tablet's headphone jack and is compatible with the Lightning to 3.5mm headphone adapter supplied with the iPhone 7 and 7 Plus.
Of Australia's four major banks so far only ANZ has embraced Apple Pay, while Commonwealth, Westpac and NAB lost an appeal to Australia's competition watchdog to engage in joint negotiations with Apple.
This standoff, combined with Australia's wide adoption of contactless credit cards, is hampering the uptake of Apple's payment technology but Pfisterer expects mobile payments will take off quickly once Apple and the banks make peace.
"From our perspective we understand that it's a complicated issue," he says. "We hope that this impasse passes quickly and ultimately we can start seeing the onset of mobile payments."
"Whilst Apple's discussions with the banks are ongoing, it's a shame to see both consumers and businesses miss out on the opportunity to use what's a really exciting and convenient technology. We believe that it's only the start of something really big, so hopefully it gets worked through pretty quickly."