Square Spreads to Local Business and Student Groups

Inside the Stuff Sale tent earlier this year, members of Harvard Habitat for Humanity used iPhones and iPods to accept payments for everything from fans to furniture. Instead of withdrawing money, students wishing to purchase items for their dorm room were able to use credit cards, and sellers no longer needed to keep track of wads of cash.

Responsible for this transition? An inch-wide device named Square, which—when plugged into the headphone jack of a smartphone—allows any individual or business to accept credit card payments via a free mobile application.

Square, whose board of directors includes Former University President Lawrence H. Summers, has quickly gained prominence in the Harvard community as it allows students, organizations and local businesses to accept credit cards more easily.

SPREADING ACROSS CAMPUS

From House Committees to student-run businesses, several groups on campus have latched onto Square to increase their sales.

Alisandrea A. Waldron ’13 serves as the Harvard campus representative for Square through the company’s SquareU program, which promotes use on college campuses. Waldron is one of 55 representatives at selected schools throughout the country.

Waldron has been promoting the device to students and organizations, including Habitat for Humanity and Harvard Student Agencies

As a SquareU rep, Waldron can provide interested users with the free product.

“It doesn’t cost anything to get a card reader, so if you need to take a payment and the person doesn’t have cash, Square enables you to do that,” Waldron said.

“I think all student organizations at Harvard could use Square to take payments for merchandise or dues. It is a great resource for students that can simplify the lives of financial directors in student organizations,” Waldron noted.

Indeed, the Mather HoCo is planning on using Square for House clothing orders this year. The product will coordinate all credit card sales to one bank account instead of having various members of the board collect cash.

“We had issues last year with our clothing orders, so we’re using Square to try to make it easier for the House,” said Mather House Committee Co-Chair Andrew F. Iannone ’12.

HSA used the product at Commencement last year during their tent sales, which sell logo apparel to the visiting throngs. HSA President Ethan A. Waxman ’12 said the tents had been a growing part of their business, but they found more of their customers wanted to use credit cards.

Before Square, HSA members would use carbon paper to record credit card information. The organization lost sales, however, since some credit cards would get declined.

Waxman said the HSA will not use the device in the Harvard Shop year-round due to the lack of an inventory management system that they have built into their current system.

“We’re not going to replace our systems, but it’s been fantastic for our tent sales. It’s hard to quantify [compared to previous years], but our tent sales have been easier and faster,” Waxman said.

COMPLETELY WIRELESS

Created by Twitter co-founder Jack Dorsey in 2009, Square began as a start-up in Silicon Valley and has since spread across the country. Any individual can request a free device at squareup.com and download the free application on a iOS or Android device.

The device requires a cellular network or a wireless connection and can make a transaction in about three seconds, according to Katie R. Baynes, public relations manager at Square.

The company charges 2.75 percent of the transaction cost per credit card swipe. The same fee applies to all accepted credit cards.

After swiping the credit card, customers can sign on the screen and receive an email or text message receipt.

Square insures security by complying with Payment Card Industry standards and encrypting all of its data. The application does not store any information, and users must go through a short security check before opening an account.

But some still find the mechanism a bit disconcerting.

“It’s almost concerning how easy it is. You could take someone’s credit card and give yourself a lot of money,” said Waxman.

MOBILE BUSINESSES

Not all local businesses have had glowing experiences with Square.

Clover Food Lab, a vegetarian restaurant on Holyoke St., began using Square in October 2010 but has since switched to using it only as a back-up if their current system goes down.

Ayr M. Muir, owner and founder of Clover, noted that at the restaurant the system had tended to be slow and unreliable.

The benefit, Ayr said, is that the system does work with an iPhone, which they use to take orders onboard every food truck. As a result, if the primary system goes down inside the truck, they can still accept credit cards.

Even with the monthly fee, transaction fee and percentage transaction fee of Clover’s current system, Muir said it is cheaper than using the Square due to the number of transactions Clover does per day.

“It’s similar to a cell phone plan. Depending on your use, if you pay for a bigger plan, it costs you more. If you use Square, there’s no monthly plan cost but the per transaction fee is much higher,” Muir said.

Square can therefore be more compatible with small businesses who do not have many transactions per day.

Several tents at the Harvard Farmers Market now use Square to provide the convenience of cards to customers at their stands.

“People are convinced that you don’t need to carry cash anymore, but that doesn’t work in a farmers’ market,” Brian Quinn, co-owner of Q’s Nuts, said at his stall outside the Science Center Tuesday.

Quinn looked into purchasing a credit card system but did not want to make a long commitment or pay a monthly fee when his business is seasonal.

“All I had to do was get a smartphone,” Quinn said.

—Staff writer Kerry M. Flynn can be reached at kflynn@college.harvard.edu.