Square is hoping to expand its reach in online payments by making it easier for merchants to adopt its service.
The company on Wednesday unveiled a way for all online retailers to add its payment processing to their sites. Before, only merchants that used Square’s software to create their online stores could do so.
The change eliminates a big stumbling block for Square as it tries to compete with rivals PayPal and Stripe. Both companies have a big head start in offering payment processing to online retailers, which account for a growing piece of overall commerce.
Square, which is led by co-founder Jack Dorsey, is pushing hard to expand its business following a high-profile initial public offering in November. The company, which initially sold a credit card reader for merchants to attach to iPads and iPhones, has expanded into invoicing, cash advances, online lending and appointment scheduling.
And Square’s bet has been paying off with fourth quarter sales for software services rising nearly four-fold to $22 million from the same period a year earlier, beating analyst expectations.
Alyssa Henry, Square’s product lead for sellers, said that one of the benefits for merchants of using Square’s new API, or “application programming interfaces,” for online payment processing is that sales data from multiple sources can be integrated to give a fuller picture about customers. A merchant using Square’s credit card swiper and new the API will be able to see all its sales data combined.
Square charges merchants a 2.9% fee and $0.30 per transaction.
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In addition to a payments service, Square (SQ) is now letting developers and merchants create their own point of sale software that can work with Square’s credit card swipers and hardware. Square says that many specialized merchants, such as wineries, need customized software to manage transactions and inventory.
Henry said that Square’s credit card swipers can be attached to any software using another new API.