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Square Is Discontinuing Monthly Pricing On February 1, 2014 114

Posted by Unknown Lamer
from the something-about-being-easier dept.
An anonymous reader writes "Mobile payment startup Square has decided to discontinue its monthly pricing option on February 1, 2014. The company says it does not plan to reinstate monthly pricing at any point. If you are currently enrolled in monthly pricing, Square will give you "a grace period" through the end of January 2014, after which the per-swipe rate will apply to transactions. On January 2, monthly pricing subscribers will be billed their last monthly fee, which will cover the rest of the month."
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Square Is Discontinuing Monthly Pricing On February 1, 2014

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  • wut? (Score:3, Interesting)

    by AntiBasic (83586) on Sunday November 10, 2013 @04:09AM (#45381823)

    wut?

    • Re:wut? (Score:5, Informative)

      by digitalchinky (650880) <dtchky@gmail.com> on Sunday November 10, 2013 @04:27AM (#45381867)

      It appears to be some kind of slashvertizement for a mobile credit card reader that plugs in to the headphone jack of an iphone.

      • Re:wut? (Score:5, Funny)

        by Anonymous Coward on Sunday November 10, 2013 @04:53AM (#45381919)

        I personally don't think equiangular polygons should have the right to decide pricing schemes. IMNSHO humans, and only humans, should be able to make choices like that. Otherwise what's next, a glorified calculator deciding when to fire people? It's wrong, I say, WRONG!

        • It's humorous for two reasons:
          1) "Square" the business name can be confused with "square" the algebraic shape;
          2) Executives and beancounters are often perceived as "glorified calculators".

          Mod parent up for being funny. +2 very funny, I say.

          • Re: (Score:3, Funny)

            by larry bagina (561269)

            And you made it humorous for a third:

            Square
            1. (n; adj) A person who is regarded as dull, rigidly conventional, and out of touch with current trends.

      • Re: (Score:2, Informative)

        This is actually a widely-used credit payment processor, particularly by local businesses, so this is definitely a change that will have a fairly wide-reaching impact.
  • Big deal. (Score:4, Informative)

    by viperidaenz (2515578) on Sunday November 10, 2013 @04:22AM (#45381847)

    It's a hit to larger companies, not smaller ones.
    Switching from $275/mo flat rate to 2.75% means if you're selling more than $120,000pa, you pay more, if you're selling less, you pay less.

    next story please.

    • Re:Big deal. (Score:5, Informative)

      by aaronb1138 (2035478) on Sunday November 10, 2013 @05:19AM (#45381969)
      Really a good sized hit to small to middle sized businesses.. you know the mom & pop shops, indie food trucks (the minority) and such that manage to support 2-5 people with corporate incomes of 250k-2m per year.

      A small company with CC swipes of $120k / year with an assumption CCs only being half their income, and the rest cash or invoices (checks), barely supports 1 person if the net margins are very high, in the 20-40% range and tax sheltering is very good.

      Glad to see how well educated the techie community is on basic finance and business concepts.

      Of course, we know that with the standard margin in CC processing being 3% for many years, it was very expected by any reasonable person that Square would ditch flat rates once they had little enough competition and a large enough base.
    • If you're selling less than $120k, you're not a company. You're barely even in business at all. That's revenue, not profits.

    • by Ksevio (865461)
      $120,000 per year is only around $500 per work day (~$330/day). You don't have to have a large business to hit that amount
      • Again, this is via a single method of payment.You don't have to be a large business to accept cash, cheque or invoice.

  • Swipe? (Score:5, Insightful)

    by thegarbz (1787294) on Sunday November 10, 2013 @04:22AM (#45381851)

    So after many years of regulations, encryptions, standards, tamper proof systems, migrating from a magnetic strip to the chip and pin for even greater security, this company's innovation pisses all that against the wall?

    Man... I would not do business with anyone who wants to swipe my credit card through an iPad.

    • Re: (Score:2, Informative)

      by Anonymous Coward

      In just over 1 year you won't have to. At least in Canada, after 2015 debit card companies will no longer need to include a magstripe unless they really want to. I expect credit card companies will follow suit quickly. Magstripe fraud is costing both huge amounts.

      At that point square's equipment will be as good as garbage. I'm sure as a backup for places that refuse to upgrade they'll still be able to take imprints, just like 50 years ago.

      • by mysidia (191772)

        I'm sure as a backup for places that refuse to upgrade they'll still be able to take imprints, just like 50 years ago.

        50 years ago? It was common about 20 years ago.

        Also; I made a purchase at a store that did an imprint, about 6 to 8 months ago.

        • And then you made purchases at various outlets in Prague, Adelaide and Ouagadougou, about 5 to 7 months ago.

          • by zero0ne (1309517)

            That's BS and you know it - US CC companies have some of the best fraud detection around...

            The second a charge on my CC goes through in a state I have never been or never lived in (or couldn't travel to within the time of my last legit charge), they are calling me and asking if the charge was valid.

            Last time I purchased something on eBay, I received the very same phone call because it was over $1,000

      • by colinnwn (677715)
        In the USA my understanding was PCI requirements were going to make all companies switch to non-imprintable cards? All of my cards issued in the past year are completely flat.
        • In the USA my understanding was PCI requirements were going to make all companies switch to non-imprintable cards? All of my cards issued in the past year are completely flat.

          Perhaps only certain banks are doing it. Of the two cards that I got this year, both were embossed.

        • My last card was like that. I just assumed it was because they printed it on-demand at the branch office, rather than having it mailed from their credit card processor. I don't know if that's an improvement in security. It still has a mag stripe on the back, and now anyone with an ID card printer ($800 with a quick google search) and a stripe encoder ($200 on Amazon) can make cards.

          I was there getting my card replaced because someone hacked Harbor Freight and stole the track 2 info from cards. (CC#, exp

      • Canadians love traveling to the states to get cheaper products with lower sales tax. They won't willingly sacrifice their mag stripes when they are needed to conveniently spend money in the US.

      • by Grishnakh (216268)

        That's Canada. Canada is a much, much smaller market than the US. The US will hang onto magstripe technology for decades, maybe more. Just look at how backwards our banking systems are here: people still use paper checks, there's no electronic funds transfer without huge fees, there's no real use of crypto, etc. Look at Europe to see what banking should be like; we in the US are at least a century away from getting that kind of technology, with the rate of change here.

    • by PRMan (959735)

      My brother runs a small booth that sells superhero t-shirts and memorabilia on the weekends. Do you think that he shouldn't take credit cards? Or that his taking of credit cards would be more "legitimate" if it didn't go through his cell phone? Utter nonsense.

      And if he's wrong about the legitimacy of the transaction the company will just reverse it on him and he loses the money, not you. And that's happened all of once for $80 over a 2 year period.

      • by thegarbz (1787294)

        No he shouldn't. Not unless he's willing to buy/lease a proper solution from his bank which embraces the proper security protocols established by the industry. A lot of effort has been put into card readers to make them safe from tampering by the merchant themselves. Not just software either. Simply opening one of the card readers will completely brick them. Want to access the circuit board without opening by drilling into the side? Nope that'll typically trigger a trip grid around the inside of it.

        The only

        • Re:Swipe? (Score:5, Informative)

          by BKX (5066) on Sunday November 10, 2013 @07:43AM (#45382415) Journal

          Simply opening one of the card readers will completely brick them.

          Probably not. I've repaired and/or replaced many keypads and phone jacks on CC terminals over the years. I've done this for readers made by several different companies and many levels of features, including Hypercom (the most popular brand), and terminals that have RFID readers and external pinpads. Opening them up has always been easy, and they accept my soldering iron and screwdrivers just fine. I doubt there's much in the way of tamper-proofing on the portable ones either, even though I've never worked on them, considering the lack of tamper-proofing on anything else they make.

          • by ganjadude (952775)
            the ones from verifone Do in fact have a "tamper detected" error if the device is tampered with in any way, in fact it can be a little to touchy at times. It does not "brick it" per se, but it does have to be sent back to verifone for reprogramming and the store is sent a new one. at least thats how my experience has been
            • by thejynxed (831517)

              The Verifone models are also what quite a few stores use around here as well. I can confirm they are touchy, and "die" often (I think due to customers poking them too hard or something during debit transactions), but they also are all the models where you can swipe a normal card OR "tap" the chip-enabled cards to perform the transaction (which I guess helps our foreign tourists out, as there is only one card & card company here that offers them, so, useless to us locals).

              There's been a few times where t

        • by drinkypoo (153816)

          The only thing that is utter nonsense is that we've pissed all advances in security against the wall by releasing a device that reads a mag stripe (I'm not sure this is actually accepted in some countries anymore), and that has only a bit of software separating a potential fraudster from a credit card.

          They don't even need to swipe your card, dude. They can do it by the numbers. There is no security in credit cards whatsoever. All that technological whizbang bullshit they've put on them doesn't close the human loophole.

          There's a reason chip+pin was introduced and that was to separate a merchant even more from the customer's credit card. Now there's no reason for you to hand your card over to the waitress anymore and wait while she disappears with it in the back room.

          Unfortunately, most credit cards don't actually have chip+pin. I've never even seen one that does.

          • Depends where you are I suspect. In the UK, all new cards over the last few years have been chip and pin.

          • by Cimexus (1355033)

            YMMV of course. I haven't seen a card issued in the last several years that doesn't have a chip (even in Australia which was notoriously late getting on the chip-and-PIN bandwagon compared to Europe ... I remember having issues using my Australian card in the UK in the mid-2000s because they all required a chip even a decade ago). I think it's only pretty much the US now where it's not standard.

          • by thegarbz (1787294)

            They don't even need to swipe your card, dude. They can do it by the numbers. There is no security in credit cards whatsoever. All that technological whizbang bullshit they've put on them doesn't close the human loophole.

            That loophole only exists if someone has my card. I don't give it to anyone. The swipe machine is brought out and people say here you go, and you do the rest of the transaction yourself.

            Unfortunately, most credit cards don't actually have chip+pin. I've never even seen one that does.

            I haven't seen one in about 3 years that doesn't have chip+pin. I have occasionally swiped my card when I've had a mental blank and the machine beeps at me saying I need to insert the chip.

            • by Kalriath (849904)

              The number of merchants (I'm in NZ) who have an ancient reader that doesn't have a card slot on the pinpad or who claim "oh that doesn't work, you have to give it to me so I can do it on this side" is staggering. Even more staggering is how many merchants persist in swiping the card before checking for a chip and inserting it (some banks actually advise that this is a fraud indicator, and you should not shop at these places).

        • by ganjadude (952775)
          not that your fear is misplaced but perhaps you should do a little bit more research on the topic. Square devices are just as secure as those fancy pin readers (disclosure - I work for a pin pad company now) When the card is swiped in a square device, the owner of the device has no electronic record of the numbers to keep for his own use, just like a store does not have a card number to keep for its own use. Sure a hacker may be able to break the encryption and get the information, but it does not seem that
          • by thegarbz (1787294)

            The square device can suffer from a MITM. The older one didn't even encrypt the data from the swipe card when it got sent to their servers. Magnetic swipe cards do not support pin numbers.

            I'd be slightly more happy if they didn't use a magnetic reader, but they don't. The fear is misplaced because magnetic swipes are an ancient outdated technology with very few protections and which some countries are in the process of actively outlawing.

        • Re: (Score:3, Informative)

          by BitZtream (692029)

          Square is fully PCI compliant because IT DOESN'T STORE YOUR INFORMATION and USES SSL TO TALK TO ITS SERVER. Thats ALL the security you get ANYWHERE on the client side IN THE BEST CASE situation.

          Stop spewing shit you know nothing about. 99.999% of the PCI rules are written around the fact that people STORE the credit card numbers. The instant you stop storing card information, PCI becomes ridiculously less complex.

          Welcome to what Square does ... it makes all the PCI compliance issues a problem for Square

          • by thegarbz (1787294)

            Just because you've not seen Chip+Pin doesn't mean you should be actively supporting the continued use of your outdated technology.

            I think we have a fundamental misunderstanding because you live in a country which is quite backwards on credit card security. I haven't seen a magnetic stripe reader in use in a very long time, I haven't owned a credit card without chip+pin for at least 3 years and even when I did I never used that card.

            In other use the vast majority of internet traffic isn't encrypted either s

        • "Simply opening one of the card readers will completely brick them."

          Irrelevant if you not trying to send fraudulent transactions over the network yourself. If you are just skimming cards then you don't need a real transaction at all. You sell the info and let other people make widely dispersed fraudulent transactions.

          "There's a reason chip+pin was introduced and that was to separate a merchant even more from the customer's credit card. Now there's no reason for you to hand your card over to the waitress any

    • Re:Swipe? (Score:5, Interesting)

      by BitZtream (692029) on Sunday November 10, 2013 @10:32AM (#45383375)

      Thats because you utterly fail to understand any part of the process. This isn't insightful, its just the opposite, it shows ignorance.

      First off, the strip on your card, not encrypted in the first place, its just data. Encrypting it offers nothing of value as you would then just end the encrypted blob, which anyone could also copy and send. You can read it with a modified 8 track player and some software (this is essentially how square works) or any of the thousands of various card readers that hook up to a PC as if it were a keyboard.

      None of the data stays on the iPad, its simply forwarded off to squares servers to do the real work.

      Do you think its a better setup to do the card reading on a virus and malware infected PC instead, you know, one of those PCs that you run your card through every day at the gas station or restaurant you eat at instead of the walled garden that Apple built.

      If this bothers you, it just shows you're ignorant of the actual security concerns. You should be far far more concerned with the waiter or mcdonalds employee you hand your card through that can just snap a pic of it when you're not in sight.

      • by thegarbz (1787294)

        No it shows you're ignorant of the direction in the industry. The world over is doing everything in its power to get rid of magnetic stripe readers for EXACTLY the reasons you specify, yet here we have a system and service that actively embraces it.

        It does bother me now. It wouldn't bother me if this was a product of 10 years ago, but it's not. It's a product of 10 year old technology at a time when the entire industry is trying to move away from it *because of the security concerns*.

        As for the ummmm PC con

    • You would be better off if you only swiped through an iPad. All these iPad swipers are encrypted and tamper proof with decryption only possible at the card processor. The majority of the regular swipers you see at retailers do not use the end-to-end encryption.
      • by Lehk228 (705449)
        the original readers used analog audio connector and were totally unprotected. then VISA threatened them and they improved the device
  • by thsths (31372) on Sunday November 10, 2013 @04:23AM (#45381853)

    I can see two problems with this statement:

    It is not a flat fee.

    And it is not per swipe.

    In fact, it is a commission or a share.

    Oh, and it is of course not a benefit for the customer, as much as square is wiggling around the issue. They remove a price plan, and thereby increases prices.

    • in other words... (Score:3, Informative)

      by Anonymous Coward

      they're adopting the pricing scheme of every other payment processor, including paypal and intuit (both of which have a very similar device and service), google checkout (wallet) and ordinary credit card merchant accounts.

    • Re:It is not flat (Score:5, Informative)

      by kramerd (1227006) on Sunday November 10, 2013 @06:05AM (#45382081)

      The plan was $275/month or 2.75% per swipe. However, the 275 per month was limited to the first $10,000 (ie $275 in fees). After this, it defaulted to the 2.75% anyway. Therefore, if you chose monthly, and didn't use it all, you actually paid a higher price. By definition, you could always just take the 2.75%, so I don't know why anyone would ever choose the monthly plan in the first place.

      • Actually, any single transaction over $400 was processed at 2.75%. All transactions over a monthly limit of $21,000 was processed at 2.75%, which equals a p.a. amount of around $250,000 a year. So this is essentially a huge blow to the small businesses (restaurants, food carts/trucks, pedicabs, etc etc). And they're selling it as a way for businesses to save money, by keeping the same 2.75% they've always charged per swipe. Oh, and the restaurant I managed (a small hole-in-the-wall) switched to Square's
        • If they're netting $100 at the end of the month, the problem isn't the use of this CC provider or that one - it's a fundamental lack of understanding about pricing of product and cost controls. They are off a few orders of magnitude in terms of profitability to be a going, micro-restaurant business...
          • There are other problems, sure, but this was easily fixed :P Truth be told, the owner didn't (doesn't) care about the restaurant as long as it doesn't lose her a lot of money. She mostly is across the country catering on-scene locations.
  • Advertisement (Score:5, Insightful)

    by Anonymous Coward on Sunday November 10, 2013 @04:28AM (#45381869)

    This _might_ deserve a blurb in a payment industry trade rag, but why /.?

    Are we covering all merchant fee plan changes in the that industry now?

  • unchanged.
    • The charges for anyone paying with hairs on my genitalia are also unchanged.

      And that's a scarce resource produced at a decreasing rate, hard to counterfeit.

      WHY AREN'T YOU ALL USING MY PUBES AS CURRENCY, LIBERTARIANS?

  • I can't keep up with all the little new web companies that come out anymore. What are they, and why is this change important? At least mention it in the summary.

    • by Chas (5144)

      Square is a payment processor.

      Their "schtick" is including a credit card magstripe reader that plugs into the headphone jack of an iPhone or iPad.

      It's actually fairly useful, as it allows all sorts of businesses to take credit cards that would, otherwise, be too small to afford some form of mobile payment acceptance. It also allows the vendor to e-mail receipts to their customers if the customer so chooses.

      I use them at conventions as a backup if our normal credit card readers stop working for any reason.

  • ...thinking that this was a post about the computer game Final Fantasy XIV or something... Turns out it's some stupid I-don't-know-what that can be easily used to steal your credit card info.

    Pointless...

  • Who thought they were talking about Square-Enix?
  • This shouldn't be a big surprise...the flat rate plan was clearly a loss-leader meant to gain marketshare.

    Most of the fee you pay to companies like Square doesn't go to them. It goes towards the "Interchange Fee" charged by Visa, MasterCard, and AMEX. These interchange fees vary based on card type (for example, fees are higher on "reward cards"...that's what funds the "reward"), and transaction type ("card not present", for example, has a higher rate). Check over the interchange fees for Visa [visa.com] and MasterC [mastercard.us]

    • The confusing thing is that all these companies exist at all. Shouldn't the credit card processing networks themselves be offering these services? Why should my payment go through a shady pseudo-bank (paypal) AND a credit processing network before getting to the real bank actually disperses the money and which I have promised to pay back?

      • by krs440 (3426673)
        Before the likes of Paypal, Square, etc, things were as you described. A small number of stodgy companies controlled most of the market share for merchant accounts. These companies exist because they saw that the needs of a large part of the market was being ignored.
      • The credit processing networks didn't offer an equivalent service because doing so would cause them to lose money.

        Money losing market-niches are generally rather sparsely occupied.

        Now I guess Square is established enough they are going to vacate that niche too.

    • by Kalriath (849904)

      The market that's more curious to me is the "card not present" market...payment processors for websites. Stripe [stripe.com] seems to be the darling of the Slashdot crowd, but their pricing is horrible. They offer 2.9% + $0.30 per transaction, and won't offer to discount it until you're doing $1M+ per year. Contrast with Paypal's Payment Pro [paypal.com] which drops down first to 2.5%+$0.30 once you hit $3k/month, then down to 2.2%+$0.30 once you hit $10k/month. Stripe has a few features that PPP doesn't, but they would need to be real important to you to pay that much more.

      But wait, there's more! An actual bank will probably charge you 2.0%+$0.30 for virtually zero volume (I'm on 2.2%+$0.50 NZD so about $0.40 USD but we're known for being more expensive). Plus, an actual bank will offer you the benefit of the 3DS liability shift (which PayPal/Stripe will not).

      So why does anyone use these services again?

      • by krs440 (3426673)
        At least in the U.S., an "actual bank" doesn't offer a service that will process Visa (Debit+Credit), MC (Debit+Credit), AMEX, and Discover. You're paying for the aggregation into a single API, as well as a single business process for auth, chargebacks, etc. So, paying 2.2% + 0.30 works for me, and I can rationalize the slight upcharge.
        • by krs440 (3426673)
          Also, don't believe the "Qualified Rate". Chase PaymentTech, for example, says their rate is 1.79% + 0.24. But, there's a big asterisk that the rate applies only to "qualified transactions". Reward cards, for example, aren't qualified, and in many niches, these will account for 30+% of transactions. While they do have their warts, the Stripe, Paypal, etc, don't have these tiers. The rate is what's shown...no tiers, no "qualified rates".
          • by Kalriath (849904)

            What you're referring to that Stripe and Paypal offer is what's called a "Blended Rate" if you get it from a bank. Mine is blended, but I could also opt for what's called "Interchange Plus", where instead I'm charged the Interchange rate (what the issuing bank charged the acquiring bank to process the transaction) plus a margin.

  • Slushdot's fortune cookies need a thorough overhaul.

    Just as a for-instance, I keep seeing "There's no such thing as a free lunch" attributed to Milton Friedman. Phrase finder attributes [phrases.org.uk] the original statement to journalist Paul Mellon, in a January, 1942 editorial response to a speech by then-vice-President Henry Wallace. It notes that the phrase is associated with Friedman only because he appropriated it as the title of his 1975 book - but he would have been in grade school when Mellon's editorial was firs

    • by krs440 (3426673)
      Attribution can be tricky. You seem pretty sure that the original statement should be attributed to Paul Mellon, and mention it's from January, 1942. What about this? http://news.google.com/newspapers?nid=1144&dat=19380705&id=ZysbAAAAIBAJ&sjid=BE0EAAAAIBAJ&pg=1516,6094461 [google.com] It's the July 5th, 1938 edition of the Pittsburgh Post Gazette, specifically, a story entitled "Economics in Eight Words". The last line is "There ain't no such thing as free lunch". I assume that the difference of
      • by thomst (1640045)

        krs440 noted:

        Attribution can be tricky. You seem pretty sure that the original statement should be attributed to Paul Mellon, and mention it's from January, 1942. What about this? http://news.google.com/newspapers?nid=1144&dat=19380705&id=ZysbAAAAIBAJ&sjid=BE0EAAAAIBAJ&pg=1516,6094461 [google.com] It's the July 5th, 1938 edition of the Pittsburgh Post Gazette, specifically, a story entitled "Economics in Eight Words". The last line is "There ain't no such thing as free lunch". I assume that the difference of "There aint" vs "There's" and the missing "a" aren't terribly important. I have no idea if this is the first occurrence of it either.

        If you read the reference I cited (pause for derisive laughter from the peanut gallery), you'll note that IT draws a distinction between the two formulations. Like Friedman with the more formal phraseology, Robert A. Heinlein is frequently credited with "There ain't no such thing as a free lunch." In fact, he DID come up with the acronym TANSTAAFL (in his 1966 novel The Moon Is a Harsh Mistress), which is now widely used, but, as you point out, he certainly didn't coin the parent observation.

        So

        • by krs440 (3426673)
          Sorry, you lost me. I did read your reference. Yes, it mentions the variation, which is what cause me to do a little searching to see the earliest documented reference I could find with minimal effort. I'm clearly not the expert you are on attribution. However, as a layperson, crediting Paul Mellon for a minimally reworded version of a phrase doesn't seem much better than crediting someone who bothered to use it for a book title.
          • by thomst (1640045)

            krs440 stated:

            Sorry, you lost me. I did read your reference.

            The aside was directed at the peanut gallery - not at you. (Your user number indicated that you ought to be familiar with the /. habit of responding to postings without having first read the article to which they refer. It's practically an article of faith around here. The notion that the gallery would bother to read a link posted within a comment is still less likely. Your research citation made it pretty clear that you're the exception that proves the rule.),/p>

            Yes, it mentions the variation, which is what cause me to do a little searching to see the earliest documented reference I could find with minimal effort. I'm clearly not the expert you are on attribution. However, as a layperson, crediting Paul Mellon for a minimally reworded version of a phrase doesn't seem much better than crediting someone who bothered to use it for a book title.

            Again, they're not the sam

  • For our business, we have been using Square only because of that pricing model. Their customer service is one of the worst I have ever encountered (they think Twitter is a good place for businesses to discuss credit card processing publicly), they make a lot of decisions that are cute but either useless or in fact make things worse and less productive. I have been so frustrated with them for months but couldn't go elsewhere because of the rates. This change sucks but at least now I can walk away without any

Reality must take precedence over public relations, for Mother Nature cannot be fooled. -- R.P. Feynman

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