New iPhone Payment System

Self Edge NYC, a New York supplier of denim clothing and other accessories, has launched a new payment system based on Apple’s iPhone. The system is named ‘Square’ and it requires no ink or paper to complete a credit card transaction between a store employee and a customer.

This new payment processing method basically consists of having a small card reader inserted in the headphones jack of your iPhone (or iPod Touch) that will transfer the card data to a specific application on the iPhone. The store employee is supposed to enter the total cost of the merchandise purchased, while the customer adds his/her signature using the touchscreen and an email address as a destination for the receipt (the receipt also includes a map with the location of the transaction).

The transaction is processed by Square which currently has a percentage fee (2.5%) and also a fixed fee of 50 cents per transaction. The money is transferred directly to the store’s bank account. The system is supposedly in its alpha-testing phase, but it seems the majority of people that have used it are satisfied so, should it prove successful once released on a large scale, it might be the start for a whole new experience with credit card transactions.

New iPhone Payment System (card reader): [Link]