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There are limits (it's still _revolutionary_ for an industry that loves to nickle & dime, though) Up to $400 per any single transaction and up to $250,000 in t

There are limits (it's still _revolutionary_ for an industry that loves to nickle & dime, though) Up to $400 per any single transaction and up to $250,000 in total transactions per year—or approximately $21,000 per month. Swiped transactions over these limits simply cost 2.75% per swipe. $21,000 * .0275 = $577.5 in fees. I would love to see more Square adoption. In Charleston, lots of cart vendors (hot dogs, popsicles) use Square, as well as many vendors at the farmers market.

MIT_Hacker 14y ago
I think it's the perfect response to the Starbucks deal. It shows that Square is still keeping small businesses as their top priority.
jessepollak 14y ago
Essentially, a 1.32% transaction fee for all revenue under $250,000, 2.75% on all revenue over. Deal gets worse for the business the further your revenues are from the $250K limit. Definitely a big deal though.
- kennywinker 14y ago
  It's definitely targeted at getting more businesses that do $120,000 - $300,000 on credit cards annually. I'm guessing they were having issues with adoption in that sector so they rolled this out to make it a little tastier. They probably have the best penetration in the under $120k/year sector, because of the ease of setup, low overhead, no monthly fees, etc. I have a good friend who runs a small shop (> $50k/year) and she loves square. Got them up and running painlessly, their iPad is their cash register / POS system, and she pays a manageable amount to Square for it. She keeps asking me when Square is going to start doing online payments, because their transactions tend to be small online PayPal's 2.9% + 30¢ is painful in comparison.
phjohnst 14y ago
Don't forget the up-front fee of $275, so max savings are more like $300. Break-even is $10k per month. It's a nice idea, though I don't know how many companies are in the $10k-$21k/month revenue bucket that would see a benefit. All companies processing over $250k per year can save a max of $300 per month by signing up to the fixed rate plan and then paying the normal fee thereafter. The new fee band gives savings to those processing more than ~$10k/month, but provides no savings for smaller users.
- charlesju 14y ago
  It's not strictly for the band of $10k to $21k per month. It's anyone that makes more than $10k a month because additional swipes after $21k are the same as the opportunity cost. This is a great deal for any company making more than $10k a day, or about $500 assuming 20 working days a month. It's starting to sound like a decent deal that should appeal to a lot of small businesses.
  - sharth 14y ago
    Unless they can find cheaper than 2.75% elsewhere.
    - rdl 14y ago
      Which is basically anyone for Visa/MC, and even some people for Amex. Once you're reliably processing $20k/mo, your options for merchant accounts expand a fair bit. I think what this does is retain existing Square merchants a bit longer -- ones who grew from $0 to $8k or so, are now evaluating real merchant accounts. Inertia, other advantages of Square (PWS), etc. might keep those merchants another year or two, getting them up to around $20k/mo revenue, and then Square might come out with something new for them (a Square-specific payment instrument? Pre-loaded cards using ACH per merchant or across Square with 0% fee?)
jcampbell1 14y ago
These limits are in place to keep people like me from gaming the system. Without these limits I would have an Amex Black card with $1M+ in annual transactions, and enough points to cover the $2500 amex fee, and the $3300 square fee. In college, I financed a spring break trip with credit card points by buying US Savings bonds on a credit card. The US treasury quickly wised up and realized selling bonds without charging a credit card fee was stupid. Even the US treasury got caught up in the first internet craze.

MIT_Hacker 14y ago

I think it's the perfect response to the Starbucks deal. It shows that Square is still keeping small businesses as their top priority.

jessepollak 14y ago

Essentially, a 1.32% transaction fee for all revenue under $250,000, 2.75% on all revenue over. Deal gets worse for the business the further your revenues are from the $250K limit. Definitely a big deal though.

kennywinker 14y ago
It's definitely targeted at getting more businesses that do $120,000 - $300,000 on credit cards annually. I'm guessing they were having issues with adoption in that sector so they rolled this out to make it a little tastier. They probably have the best penetration in the under $120k/year sector, because of the ease of setup, low overhead, no monthly fees, etc. I have a good friend who runs a small shop (> $50k/year) and she loves square. Got them up and running painlessly, their iPad is their cash register / POS system, and she pays a manageable amount to Square for it. She keeps asking me when Square is going to start doing online payments, because their transactions tend to be small online PayPal's 2.9% + 30¢ is painful in comparison.

phjohnst 14y ago

Don't forget the up-front fee of $275, so max savings are more like $300. Break-even is $10k per month. It's a nice idea, though I don't know how many companies are in the $10k-$21k/month revenue bucket that would see a benefit. All companies processing over $250k per year can save a max of $300 per month by signing up to the fixed rate plan and then paying the normal fee thereafter. The new fee band gives savings to those processing more than ~$10k/month, but provides no savings for smaller users.

charlesju 14y ago
It's not strictly for the band of $10k to $21k per month. It's anyone that makes more than $10k a month because additional swipes after $21k are the same as the opportunity cost. This is a great deal for any company making more than $10k a day, or about $500 assuming 20 working days a month. It's starting to sound like a decent deal that should appeal to a lot of small businesses.
- sharth 14y ago
  Unless they can find cheaper than 2.75% elsewhere.
  - rdl 14y ago
    Which is basically anyone for Visa/MC, and even some people for Amex. Once you're reliably processing $20k/mo, your options for merchant accounts expand a fair bit. I think what this does is retain existing Square merchants a bit longer -- ones who grew from $0 to $8k or so, are now evaluating real merchant accounts. Inertia, other advantages of Square (PWS), etc. might keep those merchants another year or two, getting them up to around $20k/mo revenue, and then Square might come out with something new for them (a Square-specific payment instrument? Pre-loaded cards using ACH per merchant or across Square with 0% fee?)

jcampbell1 14y ago

These limits are in place to keep people like me from gaming the system. Without these limits I would have an Amex Black card with $1M+ in annual transactions, and enough points to cover the $2500 amex fee, and the $3300 square fee. In college, I financed a spring break trip with credit card points by buying US Savings bonds on a credit card. The US treasury quickly wised up and realized selling bonds without charging a credit card fee was stupid. Even the US treasury got caught up in the first internet craze.