SQUARE DROPS WEEKLY LIMITS, HAS SIGNED UP 800,000 CLIENTS

Until now, when a merchant using Square racked up over $1,000 in payments in the course of a week, everything above that limit was held for a period of time, ranging from just a few hours up to a whole month. As of today, roughly a year and a half after the company's founding, that restriction has been lifted. Now all payments will be processed immediately and merchants will have access to the funds the next day. Square also announced that, in the year or so since it started offering its wares to the public, it has signed up 800,000 merchants who have processed over $2 billion in transactions. After ditching the $0.15 per-transaction charge and with the $1,000 per-week restriction limit lifted, we're sure those numbers will only increase in the year ahead.

SQUARE'S NEW iPAD PAYMENT SYSTEM MIGHT REPLACE CASH REGISTERS

Mobile payments startup Square is announcing big numbers today—500,000 Square card readers shipped, 1 million Square transactions in May, and the startup is now processing $3 million in mobile payments per day. Clearly the company is on a roll in terms of traction and usage. And CEO Jack Dorsey is also revealing the next generation of Square. And Square is about to get a whole lot more disruptive.

Today, Dorsey is revealing Square Register, a high-powered point of sale replacement for cash registers and point of sale terminals. And the company is taking it one step further for consumers by launching the Square Card Case, a way for purchasers to access a local merchants’ goods, prices, location, loyalty card and more.

For background, Square offers an iPhone, Android and iPad app which allows merchants to process and manage credit card transactions with a handy little credit card swiping device that plugs into the headset/microphone jack. The device and service is the brainchild of Twitter co-founder and recently appointed product lead Jack Dorsey and Jim McKelvey. And Square recently raised $27.5 million in new funding, and announced a strategic investment from credit card company Visa. In Q1, Square did $66 million in payment volume (the company expected $40 million) and is now in track to process $1 billion in payment volume within a year.

Square’s COO Keith Rabois tells us that as the startup has created a payments product for small businesses, they’ve learned that many businesses have more needs than simply having a credit card processor. One of these needs is being able to not only accept cards, but also communicate with customers more efficiently. So today, Square is launching this brand new version of its iPad app, Square Register.

Rabois says the iPad app makes these expensive and cumbersome terminals obsolete for merchants. Not only is the reader and app free (and beautifully designed), but the register is designed to help create and maintain meaningful relationships with customers. Historically, Square’s readers always stored every purchaser’s receipt for merchants and allowed merchant’s to send a copy of the receipt to the purchaser via SMS and email. It was fairly simple.

Now, with the upgrade, merchants can send customers a link to download an app on their mobile phone called a Square Card Case. And this gives merchants a whole new level of engagement with their customers. And data is another big component of Square’s announcement—Dorsey says merchants will have Google Analytics style data that merchants can access, such as how many muffins were sold, and to which types of customers, and more.

APPLE STORES STOCK SQUARE CREDIT CARD READER

Jack Dorsey's über-popular credit card readers got a big thumbs-up from Cupertino this week. Square's devices are hitting Apple's 235 US retail locations and Apple.com for $9.95 a pop(with a $10 redemption code making it free), plus the 2.75 percent that the startup takes off the backend each time you use the reader -- or you can always just sign up for a free one over on Square's site. The iPhone / iPad / iPod touch plug-in accepts Visa, MasterCard, Discover, and yes, even American Express. The CEO of VeriFone will no doubt have plenty to say about the matter.

SQUARE AND VERIFONE TAKE SWIPES AT EACH OTHER

Earlier this week VeriFone CEO, Douglas G. Bergeron, wrote an open letter and created a YouTube video declaring that consumers were in “dire risk” because of competitor Square’s card reader. Although the accused company did not respond to requests for comment yesterday, Square’s CEO has published a letter of his own, downplaying VeriFone’s concerns, while taking the proverbial high-road.

“Any technology—an encrypted card reader, phone camera, or plain old pen and paper—can be used to ‘skim’ or copy numbers from a credit card,” writes Jack Dorsey, Square’s CEO. “The waiter you hand your credit card to at a restaurant, for example, could easily steal your card details if he wanted to—no technology required.”

The letter goes on to reassure Square users that the company is “constantly improving the payment experience to enhance security” and that it’s partner bank, JPMorgan Chase, “stands behind every aspect” of the company’s service.

IPHONE BECAMES CREDIT CARD PROCESSOR THANKS TO MOPHIE AND INTUIT

Credit card processing is becoming the hot app for the iPhone.  Thanks to Mophie and Intuit there is now a competitor to Square.  Using the Mophie created app and reader device you can except credit card payments for an initial set-up fee of $179 and $0.30-$0.34 per transaction through the Intuit's GoPayment system.  This transaction fee is double that of Square who only charges $0.15 per transaction.

However, the Mophie/Intuit system will charge a smaller total overall payment fee of 1.7% - 3.7% depending on the type of card being used.  Square is charging 2.75%-3.5% comparatively.

Currently, this only works on the iPhone 3G/GS, but an iPhone 4 app is in the works.