In the three years that Square has existed, the company and its hugely popular line of smartphone and tablet-compatible credit card readers have grown consistently in terms of both merchant usage and consumer popularity.
Regardless of the tangible success at Square, no one was prepared for the announcement that came this week from the company – perhaps not even some employees at Square. As it turns out, the Jack Dorsey-founded firm has experienced a payment volume increase of 25 percent since last month alone.
Just as others in the mobile payments space were temporarily distracted in March by new offerings from the likes of PayPal, which unveiled a new mobile scanner, Square was growing at a record pace inside of an industry that is more competitive now than ever.
“Square’s growth is off the charts,” independent business analyst Mike Randazzo tells Daily Deal Media. “PayPal and Intuit aren’t going away, but Square’s recent surge will leave them playing catch-up to a degree. No one else is seeing month-over-month growth like this. It will really be interesting to see where we are a month from now. If the remarkable growth continues, Square could be to mobile payments what Apple’s iPhone has become to the smartphone world.”
As of March 2012, Square had been processing an estimated $4 billion in payments per month. By late April, that figure ballooned to $5 billion. Upon confirming the jump in users and their rate of transactions, Chief Operating Officer Keith Rabois told Bloomberg that the expansion reflects on how comfortable businesses and consumers are becoming with mobile payment platforms.
“Sole proprietors and small businesses live and die by their cash flow,” Rabois said. “They don’t have access to capital; banks don’t give them loans. They need to take the money they make today and use it to pay bills, buy things and pay employees the next day, so having access to funds is super-crucial for them.”
According to Square, more than 1 million merchants are now using Square to accept credit cards. In light of that growth and the steady flow of amplified revenue, the company believes its present staff size of approximately 250 could double before the end of 2012.
The Big Picture
All told, with platforms like Square making it easier for businesses to get their money and easier for consumers to spend it, Juniper Research projects that the market for mobile payments could explode to $170 billion in transactions by 2015. That would be nearly $110 billion more than what was logged in all of 2011.
“What’s really helping to drive the growth of Square and the industry at large is confidence,” Randazzo explains. “Customers are generally not apprehensive about processing payments through Square. They are much more apprehensive, it seems, about inputting their credit card information to a website. So while eCommerce has some issues to confront in the aspects of security and consumer confidence, mobile payments seem to be shaking off worries more easily.”