Apple Passbook? What Passbook? San Francisco’s Square says it now has 2 million people and businesses accepting credit cards with the service. That’s up from the 1 million figure it cited all throughout the past year.
The volume of transactions the company processes is also up to about $6 billion per year, as the company announced earlier this week when it hired former Salesforce senior vice president Sarah Friar as a new chief financial officer. These announcements might help the company keep up visible momentum as it continues a fundraising process.
The company’s card reader is that dongle that plugs into iPhones, iPads and Android devices. They also have an app that turns iPads into registers and a mobile wallet offering called Pay With Square. The company takes a 2.75 percent share of transactions. If you back that out, you get annualized gross revenue of $165 million, but most of that fee is probably handed over to the credit card companies. There is actually an excellent discussion of Square’s prospects and model that got started on Quora this week.
Apple launched what seems like a competing product this week at its Worldwide Developer Conference called Passbook. But as Sarah Perez explored it, it actually may be an opportunity in certain ways for Square and other players in the ecosystem. Square has a hands-free payment feature in its iOS app which lets users to opt-in to a geofencing feature. It gets triggered when you and your phone are within 100 meters of a Square merchant.
Apple’s Passbook more deeply integrates some of this functionality directly into the operating system, which means that Square may have to adapt. But it’s not necessarily a bad thing, as Passbook is still missing many pieces — namely support for MasterCard, Visa, Discover, or American Express.