Square Tweaks Mobile Payments — Now Hands-Free!

With mobile payments, we’ve seen the tap, the swipe, the passcode and all sorts of other innovations.

But in this game of one-upmanship, Square has thrown down the gauntlet by announcing this morning that it has made the payment process hands-free.

The San Francisco company, which was recently valued at $1 billion, said it has made it as easy to pay as saying your name.

A new version of its application, called Card Case, will leverage geo-fencing capabilities in Apple’s latest operating system update for the iPhone. The technology will identify when a person is within 100 meters of a favorite merchant.

Square’s Director of Products Megan Quinn explains that when a shopper is within range, a tab at that establishment will automatically open — without that person ever touching his or her iPhone. Once the user places an order and goes to pay, all they have to do is give their name.

The merchant will see on its iPad that a tab has been opened in that person’s name from inside the Square app.

Once a customer gets outside of the 100-meter range again, the tab will automatically close, whether a transaction was conducted or not. In theory, this means it would only be open for a few minutes if the shopper simply walked by a coffee shop and didn’t stop.

In addition to having to have an iPhone with the latest operating system, the consumer will also have to designate shopping establishments at which tabs could be automatically opened.

Since Square opened it up eight weeks ago, 20,000 merchants nationwide have joined the Card Case app’s directory.

In May, Square unveiled its mobile payments strategy for small retailers, including the iPhone and Android applications for consumers and the iPad software for merchants. Before that, it had focused primarily on allowing small businesses to accept credit cards using a swipe accessory plugged into a smartphone’s headphone jack.

Quinn said the most obvious benefits to the new features are speed and ease of use; however, there’s a more touchy-feely reason, too. “We’ve removed the artifacts from the experience, so it’s about the interaction between the merchant and the customers.”

In other words, it’s like walking into Cheers, where everybody knows your name.

[Photo credit: Wikipedia.]

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