Today we are talking about a payment processing system that has completely revolutionized the way small businesses make transactions: Square Payment processing.
If you haven’t already heard of Square, you’ve likely seen it. The company’s trademark white, square shaped card readers bring a level of sleek modernism and sophistication to any checkout counter that uses them.
But, style is not the only perks that Square Payment brings to the table.
Alongside their Square Reader (essentially a compact POS system), Square Payment also allows small businesses to conduct online, remote, and manually entered transactions with customers.
With all these different avenues of payment processing in Square, and the company’s recent boom in popularity, one very valid question remains: Is Square safe for customers?
As a vendor, you have a responsibility not only to your own business but also to your clients to ensure that your payment process is safe, secure, and reliable.
Our team here at Average Cash understands this, so we have done the work for you to figure out if Square Payment is a secure payment processing solution that we can get behind.
If you have the same questions we do about the behind the scenes details of this in demand payment processing system, keep reading for our complete Square Payment review.
Introducing Square Payment
Square Payment, or Square Inc, was first introduced to consumers in 2010.
The brainchild of entrepreneurs Jack Dorsey (also the co-founder of Twitter) and Jim McKelvey, Square Payment was created to bridge the gap between in-person and mobile payments, and package these different transaction methods neatly into one modern and comprehensive payment processing system.
Flash forward to today, and Square Payment has taken off with success. More than 1 million small businesses in America use Square Payment processing, and the company is now valued at over $100 billion USD.
Square Payment processing first catered to small business with their Square Reader, with the innovative idea to make a credit card reader that can connect to a small business owner's smartphone, making credit card transactions available to consumers anytime and anywhere.
From there, Square Payment has expanded not only its payment possibilities, but also its encryption and security to make for far more reliable and secure payment methods since the early days of Square for small businesses.
The company's subsequent expansion includes Square readers that take chip and contactless payments, the Square Stand which can turn an iPad into a POS system, Square online and remote payment options, and Square Payroll to help small business owners manage their employee pay services.
Is Square Safe for Customers?
After we analyzed the details of Square Payment processing, our answer is a resounding yes: Square is safe for customers.
First and foremost, when a customer inserts, taps, or swipes their card on your Square reader they can be confident that none of their payment information or card data will be stored on the reader.
This ensures that your customers are being protected by fraud and identity theft, and is enabled by Square Payments’ advanced encryption on all their products (the same standards apply for Square online payment systems).
This highly encrypted payment security system is designed and maintained by Square Payment, meaning that there is consistency and transparency in how all Square Payment customers are being protected.
Aside from data security, customer safety in today’s day and age also includes contactless payment methods to curb the spread of the COVID-19 virus.
Square Payment allows customers with easy and convenient contactless payment options.
These contactless payment options include the ability to “tap” on their Square readers, enabling you to take credit card payments over the phone by manually entering the card number into your POS system, and Square Online Checkout, a newer system that lets small businesses send virtual invoices and payment links (via email, SMS text, or other accessible avenues).
What makes Square Payment Reliable for Small Business Owners?
Along with customer safety, you as the small business owner also want peace of mind that Square Payment processing is a reliable way for you to conduct your transitions.
Thankfully, Square Payment is diligent about making Square payment processing both reliable and easy for the vendors that use Square.
The company recognizes that in protecting your Square Payment transactions, Square is in turn protecting your income.
Fraud Protection
You can trust that Square Payment has your back if you ever encounter a fraudulent purchase. Square is committed to fighting fraud by empowering you with fast changing algorithms that are on the cutting edge of new fraud trends and a team of fraud experts that work hand in hand to alert you of any suspicious transactions.
Back Up in Customer Disputes
Square Payment also takes payment disputes seriously. When a customer disputes a payment, this can create a lot of stress on the vendor to deal with this complaint, not to mention that other payment processing systems will ding you with hidden fees if a customer opens a payment dispute.
If you experience a customer dispute as a Square Payment client, Square will take this stress off your hands and won’t charge you any extra fees for it.
They deal with the customer’s bank, submit documentation on your behalf, and answer any questions you may have to put you in a better position to win the dispute and keep your money.
$330 million USD: that is how much money Square Payment has saved for vendors collectively since 2011 by effectively dealing with customer disputes.
Compliance
Square Payment processing is PCI compliant, meaning that this company upholds the guidelines and expectations for security set out by the Payment Card Industry Data Security Standard.
This ensures that both you and your customers are less vulnerable to security breaches and have access to consistently safe and secure transitions.
Normally, PCI compliance would be the responsibility of the vendor, but with Square Payment the onus to maintain compliance is off your shoulders.
By using Square Payment, you are automatically PCI compliant with no additional charges to your small business to uphold this compliance.
Keep in mind that while it is not illegal to operate business transactions without PCI compliance, if your business does suffer from a cyber attack, you are legally obligated to inform all of your customers about the security breach.
Naturally, your company’s image can suffer big time from this. These are the things that keep small business owners up at night that Square Payment can help protect you from.
Secure Accounts
When you use Square Payment as a seller, the company sets you up a series of additional account protection, including 2-step verification and password feedback, to ensure that your account is as safe from malicious hackers as possible.
The Square Payment Team also upholds these security standards on the hardware and servers that hold your accounts and transactions. Square’s own in-house security team regularly monitors and tests their programming to ensure that they are impenetrable.
Reliability as a Third Party Processor
Square Payment is so secure and reliable that they have actually broken new ground in the way that third party payment processors uphold PCI compliance, setting new industry standards.
However, that is not to say that using Square Payment is always a guaranteed smooth sailing experience for every seller. Like all companies and products, Square Payment processing has a target audience that they cater to.
In particular, Square works best for small businesses operating out of the US or Canada that Square considers to be a low-risk merchant.
What does this mean? Essentially, because Square Payment is a third party payment processor, they reserve the right to freeze or terminate your Square account if their risk department determines that your business is too much of a liability for them.
Note that this practice is common across all third party processors, including big names like Shopify, and PayPal, so it is not a unique issue connected to Square Payment.
Read the contract and terms with Square Payment carefully before you sign up to avoid any unforeseen circumstances in the future.
While the majority of small businesses will never run into this issue of frozen funds or terminated accounts, companies that experience more fraudulent transactions and frequent chargebacks, especially if they sell high-ticket items, may be in trouble of getting flagged by the Square Payment risk department.
Using Square Payment to Improve Your Small Business
If you are a seller looking for a payment processing system with enhanced and responsive security, Square Payment is a logical choice.
But, the benefits of choosing Square for your in-person and online payments don’t stop at dependable security systems. Here are four more big advantages to going Square:
1. Meet Consumers’ Changing Payment Habits
Especially in response to this global pandemic, businesses have seen a rise in consumers opting out of cash purchases for the more contact-free option of paying with debit and credit.
By giving your customers the option to pay with card, or even with Square online payment options, you are demonstrating to your customers and staff that your business values their health and safety and is able to adapt to current times.
2. Make Payments Accessible Regardless of Location
All of the Square payment processing options allow you freedom in where you complete transactions with customers.
All Square products, including their Square Reader and POS system, operate off devices that are wireless and rechargeable, allowing you to easily take your shop on the road.
This is particularly advantageous for small businesses that do not yet have a storefront and sell their products in market settings.
As well, with Square online payment, enabling online transactions with customers has never been easier.
For example, with Square Pay all you need to do is send your customer a payment link or set up a payment button on your online shopping page.
Once customers select this online payment option, they are given the option to let the payment program save their personal and payment information to make future check out processes easier.
This is an effective way that companies can lower the “abandoned cart” phenomenon where potential customers begin an online checkout process but leave the page during the time consuming steps it takes to repeatedly add their personal information.
When it is all saved and ready to populate (with the customer’s permission, of course), the check out process becomes even more convenient and appealing.
3. Benefit from Transparent, Flat Rate Pricing
With Square Payment processing systems, whether in person or online, you benefit from competitive and transparent pricing, meaning no hidden or additional fees.
Square also offers flat rate pricing no matter which card your customer uses to complete their translation: No matter if they pay with American Express, Visa, or Matercard, it will all be at the same low cost for you.
Check out the chart below to learn more about the specific costs of each payment processing system Square offers:
| In person payments (through Square Reader or POS system) | • Free POS Software (can be customized based on your small business, from appointments to retail software, to restaurant software) |
| • Hardware prices range from free (your first Square Reader for magstripe) to $799 (a complete Square register) |
|
| • Payment processing fee of 2.6% +10 cents, regardless of how the payment occurs (credit card type and swipe, chip reader, or tap) |
|
| Remote Payments | • For card transactions with square invoices: 2.9% + 30 cents |
| • Square virtual terminal transitions: 3.5% + 15 cents |
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| • Card not present transaction: 3.5% + 15 cents |
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| • Card on file transactions (including recurring payments): 3.5% + 15 cents |
Square Payments also offers additional perks when you use their in person or remote payment processing options for no extra charge. These include:
4. Personalize Your Payment Options with Online Tools
A small business does not always stay small. Whether you have big sales or big ideas, Square Payment systems offer so much more than just basic POS software.
This ensures that the way you can incorporate Square products into your sales systems grows as your business does. Here are a few ways that Square Payment does this:
New incentives to build your customer base. Square allows you to expand into offering gift cards, loyalty programs, and email marketing.
Programs to support your growing team. Square offers software that makes team management easy, including normally time consuming tasks like scheduling and payroll. Better yet, the basic model of Square’s team management software is free, so you can test it out before you upgrade into their premium programs.
Modernize your small business. Square keeps up with the most innovative trends in sales and customer service so that you don’t have to.
By signing up for a Square Payment processing system, you will also have access to software that makes everyone’s lives easier, including QR codes for contactless ordering, setting up a free Square online shop, developing your own subscription service, and organizing pick up and delivery orders.
Signing Up for Square Payment
Ready to make the switch to Square?
Sign up is easy and free using their online portal.
Or, if you are still on the fence, you can set up a free consultation with Square’s sales department to help you learn more about how you can integrate Square payment processing systems to grow your small business.
As well, if your business makes more than $250k per year with an average ticket size of more than $15, you may qualify for custom pricing deals with Square Payment. Book a consultation with the company to find out what custom pricing packages they can offer.
The Bottom Line: Is Square Payment Processing Worth It?
| • State of the art security and encryption systems to keep your income safe and your customers happy | • While all basic programs and software are free, you need to pay additional costs to access more premium and diverse software and hardware |
| • Easy to use POS software that lets you get right to what matters: taking care of your customers’ purchase | • Not recommended for high-risk industries with a larger potential for chargebacks |
| • Competitive and flat-rate pricing | |
| • No additional fees: the only charges your receive are per transaction | |
| • Convenient add ons to help build your business and respond to changing customer needs | |
| • Access to intelligent software that makes building repeat customers and managing a growing employee team easier | |
| • Flexible payment options including in person and Square online payment software, varied to meet the needs of any sized business |
Overall, Square is a payment processing company that offers users easy access to innovative, flexible, and low cost payment systems.
The true potential of Square lies in their ability to provide strong, reliable, and compliant security systems that protect your customers and their transactions from malicious actors, fraud, identity theft, and disputes.
All you need to do is sign up for a free account with Square Payments, and you will have immediate access to their POS system and a free Square Reader with magstripe. From there, you have the power to decide how much you want your business to grow with Square.
