This conversation we're having? $10. I accept Amex and Visa.

December 1, 2009 5:49 PM

It's more of a "how are you paying?" than "what are you doing?" kind of business. Square Inc. is a new startup cofounded by Jack Dorsey of Twitter and Jim McKelvey which will allow businesses and individuals to take credit card payments from customers anywhere. Receipts and confirmations are paperless and get sent to buyers via text message or email. While the media believes it is set to shake up the credit card processing industry, it has also committed to donate a penny on every transaction a merchant takes to a cause of their choice. Square is starting business with $10 million in venture capital funding and is of course tweeting the process; you can see it in action here or try it at Sightglass Coffee in San Francisco.
posted by cgomez (65 comments total)

Not that this isn't an interesting idea, but it seems a little like vaporware at this point since there's no way to actually sign up as a merchant yet.
posted by odinsdream at 5:51 PM on December 1, 2009

This is just a stopgap measure until implant chips are perfected.
posted by Burhanistan at 5:52 PM on December 1, 2009

That headphone jack widget for reading credit cards is pretty damn neat. I saw it mentioned in a Stack Overflow post but had no idea it would end up here. I wish them luck with their endeavors.
posted by Blazecock Pileon at 5:55 PM on December 1, 2009

While the media believes it is set to shake up the credit card processing industry...

Really? You quote a NYTimes blog that merely reports on a flower cart owner who has been a beta tester.

Where are we led to belive that "the media believes it is set to shake up the credit card processing industry?"
posted by ericb at 6:10 PM on December 1, 2009 [2 favorites]

That headphone jack widget for reading credit cards is pretty damn neat.

...if you like the idea of your credit card info being on some dude's iPhone.
posted by DU at 6:12 PM on December 1, 2009 [3 favorites]

Saw this on another site and the first comment there struck me. Summed up it was that: this technology is pretty much just a place holder for a few years until transactions can be made mobile device to mobile device or credit card to credit card. Whoever invests in this should also be investing in what is going to replace it.

This is an idea that's so cool that it will be quickly be replaced by another technology that is cooler, and that we can all see is coming.
posted by Science! at 6:13 PM on December 1, 2009 [2 favorites]

The solution is one time use numbers generated on a customers mobile processed by the merchant's mobile
posted by Mick at 6:14 PM on December 1, 2009 [1 favorite]

Or just pass honest-to-goodness paper currency and leave out all the tracking info.
posted by Burhanistan at 6:16 PM on December 1, 2009 [4 favorites]

IMHO cell phone payment systems (aka mobile payment), seems to be where things might be headed here in the U.S. Some countries, such as Finland with Nokia Money, are models for potential future mobile payment solutions here in the U.S.
posted by ericb at 6:17 PM on December 1, 2009

Sightglass makes awesome coffee. That is all.
posted by Afroblanco at 6:18 PM on December 1, 2009

Saw this on another site and the first comment there struck me. Summed up it was that: this technology is pretty much just a place holder for a few years until transactions can be made mobile device to mobile device or credit card to credit card. Whoever invests in this should also be investing in what is going to replace it.

Remember 10 years ago PayPal had a Palm application that allowed you to beam "money" to each other via the Palm's IR port? I remember it being quite useful for, say, beaming my portion of the dinner bill. It's quite surprising something like that isn't already ubiquitous.
posted by gyc at 6:19 PM on December 1, 2009 [2 favorites]

...if you like the idea of your credit card info being on some dude's iPhone.

If it's PCI level 1 compliant (which Square claims) then you don't have to worry about it; your card info isn't actually on the dude's iPhone at any point past the initial swipe. (Presumably) the software immediately encrypts it and passes it to their centralized processor.

In other words, it acts like any other card swipe reader on any other POS you use.
posted by mark242 at 6:21 PM on December 1, 2009 [1 favorite]

...if you like the idea of your credit card info being on some dude's iPhone.

I think those are iPod Touch models in the videos, but you probably don't shop at an Apple Store, then, because that's where their payment hardware is going, as well.

I just thought going through the headphone jack was a clever way to get around the iPhone accessory port licensing process, which would have likely required the startup to divulge much of their business model. And they would be more easily able to move to other touchscreen devices in the future, if need be. Smart.
posted by Blazecock Pileon at 6:23 PM on December 1, 2009 [1 favorite]

s/don't shop/don't want to shop/
posted by Blazecock Pileon at 6:27 PM on December 1, 2009

ericb: the NYT Bits article wasn't actually what I had intended to link to, but alas, it was too late to change it. The "shakeup" is that it's bringing a competitor to PayPal for the casual merchant who doesn't have the infrastructure for credit card transactions or doesn't want to invest in the contracts most credit card processors require.
posted by cgomez at 6:28 PM on December 1, 2009

Fair disclosure, cgomez, what's your stake in this? It's a little too buzzy to be just a "oh, this is neat" post.
posted by cavalier at 6:37 PM on December 1, 2009 [2 favorites]

10th cappucino free? You are being had.
posted by pompomtom at 6:37 PM on December 1, 2009

The "shakeup" is that it's bringing a competitor to PayPal...

Well, in that case, Godspeed to these fine gentlemen.
posted by mr_roboto at 6:39 PM on December 1, 2009 [3 favorites]

cgomez : which will allow businesses and individuals to take credit card payments from customers anywhere. [...] it is set to shake up the credit card processing industry

Quick pro tip - If your business model involves paying the big boys their tithe, you won't "shake up" anything.

This provides convenience, nothing more (well, more scarily, the potential for a complete circumvention of PCI2 safeguards, but we'll ignore that for now). One more middle-man taking his cut to make your life a tad easier, and we'll thank him for tossing a penny in the bowl, straight from our pockets?

I can't deny the utility, but thanks, I'll keep using my plastic directly anywhere I can (and cash everywhere else).
posted by pla at 6:42 PM on December 1, 2009 [4 favorites]

Why not just code an app that takes a picture of the card and it reads the name and numbers by OCR?
posted by Rhomboid at 6:44 PM on December 1, 2009

mark242 If it's PCI level 1 compliant (which Square claims) then you don't have to worry about it; your card info isn't actually on the dude's iPhone at any point past the initial swipe. (Presumably) the software immediately encrypts it and passes it to their centralized processor.

I missed where it mentioned PCI1 compliant (a good start, at least), but PCI2 came about for a reason, and the proliferation of cheap portable devices that can crack older "toy" encryption in seconds has a lot to do with that.
posted by pla at 6:46 PM on December 1, 2009

cavalier: full disclosure - I think it's really neat project and I like neat things. Also, anything that has the change of sticking it to PayPal gets my support after the whole raffle thing.

I must say though, I would not be adamantly opposed to receiving some of that ten million of startup cash.
posted by cgomez at 6:46 PM on December 1, 2009 [2 favorites]

It's like the Zune, but with money!
posted by Sys Rq at 6:52 PM on December 1, 2009 [3 favorites]

This is slick, but does seem like a bit of a stop gap. Also, there are already applications that let you authorize credit card transactions via your phone, though they don't seem as slick as this one. In Canada, I know Enstream is working with the mobile carriers to get mobile payments via your cellphone going.
posted by chunking express at 6:58 PM on December 1, 2009

I missed where it mentioned PCI1 compliant (a good start, at least), but PCI2 came about for a reason, and the proliferation of cheap portable devices that can crack older "toy" encryption in seconds has a lot to do with that.

If a person claims their ipod credit card swipe is compliant, how are you supposed to verify that?
posted by Pyry at 7:10 PM on December 1, 2009 [2 favorites]

I don't really see how this is going to compete with paypal. Sure, if you wanted to send money to a person that happened to be in the same physical room as you and happened to have an iPod or iPhone and happened to have bought this little card reader gizmo and happened to have subscribed to their service, then sure, you can send them money. In other words, it sounds great for the guy selling at the farmer's market, but that guy would have never used paypal for that anyway. How does this in any way let two strangers exchange funds when they aren't in the same physical location, neither has an iPhone, and all they know of each other is their email addresses? That is paypal's bread and butter and I don't see how this service in any way competes there.
posted by Rhomboid at 7:14 PM on December 1, 2009

In other words, it sounds great for the guy selling at the farmer's market, but that guy would have never used paypal for that anyway.

I'm not sure about that. Paypal seems ideal for small-volume retailers. In fact, at a local festival just a few weeks ago I bought a skein of hand-spun yarn from a girl and transferred money directly from my paypal to hers via mobile phone. She verified it on her mobile phone and handed us the yarn.
posted by odinsdream at 7:19 PM on December 1, 2009 [1 favorite]

...PCI2 came about for a reason...

If you're talking about doing Triple-DES/AES encryption on the device instead of single-DES, I imagine it would be a lot easier for this device to update to the new spec than it would for more traditional pinpad vendors. Square updates the app to do AES encryption on the digits coming out of the reader, and they're done.

FWIW, this won't be a Paypal killer, I don't think. This is for those people who set up shop down at the local farmers market to take credit cards easier than they do now, or to make your storefront more of an Apple Store "experience" with roving registers instead of one checkout line. (Whether that experience is actually better is for a different thread)
posted by mark242 at 7:20 PM on December 1, 2009

If a person claims their ipod credit card swipe is compliant, how are you supposed to verify that?

You aren't. The hardware vendor is supposed to verify it with the PCI standards council. Having a piece of hardware that is not PCI compliant is essentially a nonstarter; companies won't (almost literally can't) buy hardware that isn't PCI compliant.
posted by mark242 at 7:23 PM on December 1, 2009

Why can't we instead use electricity as a currency, like the Romans used salt? It's lightweight, serves a practical purpose, and it has an intrinsic value. Plus, it'd get people rightly angry at rechargeable batteries that charge slowly and then "leak" out the power if you don't use them right away. This leads to a golden age in batteries, and then everyone drives an electric car, but they make sure not to drive too much as it runs on their money! Climate crisis solved.
posted by mccarty.tim at 7:31 PM on December 1, 2009 [2 favorites]

Why not just code an app that takes a picture of the card and it reads the name and numbers by OCR?

There's one very good reason, and it's that credit card processors charge more for non-swiped transactions. The reasoning behind that is that non-swiped transactions tend to have higher chargeback rates.
posted by signalnine at 7:33 PM on December 1, 2009

it has also committed to donate a penny on every transaction a merchant takes to a cause of their choice.

That has got to be the lamest incentive ever.

1. It attracts attention to the existence of what's probably a non-trivial operating fee
2. The one cent figure is on first glance the stingiest possible amount
3. There's nothing keeping any vendor from donating the amount of their choice to the charity of their choice (let alone a penny per transaction) without any third party getting dibs on the tax refund cheque.
posted by Sys Rq at 7:35 PM on December 1, 2009 [4 favorites]

One thing I don't get is how much this service charges vendors on transactions. If it's a lot, then it will make things difficult for people who aren't used to selling their stuff at high margins, and the credit card companies don't take too kindly to people who have separate prices for cash and credit or minimum totals for using a credit card (I don't think that's fair, as it targets small businesses that really can't afford to sell everything on a credit card).

I really hope that isn't the case, and I wish them the best of luck. It looks like a great system.
posted by mccarty.tim at 7:36 PM on December 1, 2009

*makes millions of single-penny donations to charity*

Whoo! 100% matching!
posted by Eideteker at 7:41 PM on December 1, 2009 [2 favorites]

This is an idea that's so cool that it will be quickly be replaced by another technology that is cooler, and that we can all see is coming.

What about this. Wallet-sized slips of paper in various dollar denominations (say $1, $5, $10, $20 and so on), clearly marked, with authenticity and value guaranteed by some central, quasi-democratic authority. Since it's guaranteed by a central authority (maybe a government?), one needn't worry about identity theft* with such a device because one does not need to link the value of the device to one's identity. This guarantee also means it is likely to be widely accepted. And since all of this can be provided on just a piece of paper, it's affordable, portable, and convenient. With some luck, the central authority could be convinced that this valuable method of exchange would promote the general welfare and aid in the pursuit of property and happiness to such an extent that it should be provisioned without cost to the polity, in contrast with other popular methods of exchange, whose providers are paid a vigorish for the service.


-------------------
*Wife's purse was stolen recently. Lost some cash, $80 bux: big deal. The real nail-biters were the check card and the credit card and the driver's license. And the new Motorola Droid with her important data (contacts, calendars, to-dos) so well integrated with google, so ubiquitous, so available.
posted by notyou at 7:43 PM on December 1, 2009 [4 favorites]

It's shaking up the plastic card manufacturing industry!
posted by Brocktoon at 7:46 PM on December 1, 2009 [1 favorite]

This sounds like a really good idea. The only problem I can see from my perspective is that here in the UK, as well as many European countries, we have adopted the 'Chip + Pin' system. This technology looks like it's pretty focussed on swiping, but it's not fundamental to the idea itself so hopefully they realise this earlier on and add this functionality to their systems.
posted by jaffacakerhubarb at 7:52 PM on December 1, 2009

Lost some cash, $80 bux: big deal

Sure — but if she didn't have those credit cards in there, how much cash would she have had?

People used to carry a lot more money around with them (adjusted for inflation) before credit cards were widely accepted and ATMs were everywhere. And ATMs cost a lot more to use and maintain than credit cards; they're hardly a good alternative.
posted by Kadin2048 at 8:00 PM on December 1, 2009 [1 favorite]

pla: If your business model involves paying the big boys their tithe, you won't "shake up" anything.

Not so! If this is successful, it will liberate merchants and consumers from directly using the credit card infrastructure, since transaction endpoints would be run by Square's software on cell phones. This is the first step towards cutting credit cards out of the picture entirely; all Square needs to do is introduce its own Paypal-like system that has lower fees than Visa or Mastercard, and voila!

Maybe that will just be replacing one evil overlord with another, but it's hard to imagine a credit company more evil than Visa/Mastercard/etc.
posted by qxntpqbbbqxl at 8:29 PM on December 1, 2009 [1 favorite]

Anything that ends the era of Paypal is too long coming. But this ain't it.

It's beyond comprehension that we have an opaque and unregulated industry of "non-bank entities" which we depend on for conducting business online. Unfortunately, this is just more of the same - we need legislative change.
posted by mek at 8:34 PM on December 1, 2009

Assorted points that might be useful:

As merchants start processing payments on mobile devices and worry about security, think about the security of the regular payments processed at retailers. A lot of brick and mortar stores network some of their machines and inventory equipment over wireless networks still using WEP or worse, with no encryption at all. Plus, having store personnel being able to bring up credit card numbers from transactions is incredibly easy - so there are more points of risk than many would like to believe. Hell, the Apple Store's handheld payment things are running Windows Mobile. So, some guy doing a swipe with his phone isn't the worst thing in the world.

Second, I think that this is cooler than some of the other services in the same category because it seems more integrated and easier to manage (like the emailed receipts things). Plus for the seller, since it's a swiped transaction, the fees from Visa/MC/Amex are lower as signalnine said since you have to actually have the card in person which reduces fraud risk and thus, possible chargebacks by the customer.

Rhomboid does have a point though, it's instant appeal is a bit limited. The competition to PayPal isn't that their somehow going to take over their bread and butter of eBay payments and those small transactions. But really, for individual sellers who do sell things in person, this opens the option of taking charge cards where it would have been too costly to get the necessary equipment and contracts before. They would have either operated as cash-only or would use PayPal to take payment from customers which has a history, as nearly everyone has experienced, as being unfriendly to both customers and sellers.

Regardless, I think it's just one of those semi-futuristic things that's become reality that excites my inner-dork.
posted by cgomez at 8:46 PM on December 1, 2009

If mobile carriers wanted to clean up on mobile electronic payments, they could encourage Apple and other makers install something like Japan's Osaifu-Keitai system in iPhones and Android phones. Encourage enough stores to install read/write terminals, allow charges to be paid as a part of one's mobile phone bill, and work to ensure interoperability with other systems around the world, and voilà, you've got yourself a money-making machine.
posted by armage at 9:34 PM on December 1, 2009

Visa and Mastercard see Paypal (and other future similar ideas) as potential threats. Schemes like this are welcome by them.

New payment schemes interest and fascinate me. New hardware tacked onto old infrastructure, not so much.

(I do miss SET though).
posted by el io at 9:44 PM on December 1, 2009

Does this get us micropayments on the web? No?

(Goes back to sleep.)
posted by maxwelton at 9:56 PM on December 1, 2009

I noticed earlier that Randy Reddig is somehow involved. Obsessives Astute fans of classic Mac games may know him better as ydnar.
posted by Mikey-San at 10:13 PM on December 1, 2009

...if you like the idea of your credit card info being on some dude's iPhone.

I hate to break it do you, but all your credit card info is printed right on the card. Anyone can take it just by looking at it, or taking a picture. I doubt the software actually leaves the credit card data on the iPhone, but even if it didn't, it's not like random servers off in the cloud are known for being super-secure.

Saw this on another site and the first comment there struck me. Summed up it was that: this technology is pretty much just a place holder for a few years until transactions can be made mobile device to mobile device or credit card to credit card. Whoever invests in this should also be investing in what is going to replace it.

That's been technologically possible for at least five, maybe ten years, and it's widely used in other countries. If it were likely to happen in the U.S, it would have happened already. It hasn't. The fact we don't have it already means there is something out there that makes it impractical in the U.S. My guess is bank laziness. Hell, we still write paper checks. There are a lot of countries where that doesn't happen either, it's all direct bank-to-bank electronic transfers.

Sitting around waiting for mobile payments, rather then actually doing something, is a huge waste of time. Besides, if this company takes off, they'll be well positioned going into the next phase.

I mean, DVDs were a stop-gap right? So why invest in netflix when video streaming is "right around the corner"? Well, content companies freaked out about DRM prevented it from happening far past the point where it was technologically feasible, and now netflix has a huge market share and is making plenty of money streaming videos. Plus they're still doing well with their DVD mailing business because not everyone is a bleeding edge early adopter.

How does this in any way let two strangers exchange funds when they aren't in the same physical location, neither has an iPhone, and all they know of each other is their email addresses? That is paypal's bread and butter and I don't see how this service in any way competes there.

1) Buy card reader.
2) Connect card reader to soundcard
3) Record card as .wav file
4) Send .wav file
5) Second party plays .wav file into iPod
6) Profit.

They're obviously not marketing it that way, but, there's no reason why doing something like that wouldn't work. Probably against the TOS, though.

Really, there's no reason why you can't take credit card numbers over the internet with a "gateway" Anyone can buy one of those card swipe devices and take credit cards over the phone, you just have to type in the numbers they tell you. The problem is, it's like $800 or something, and if you do it yourself you're on the hook for any chargebacks. That's why companies like paypal exist, to reduce the upfront cost for small companies. I imagine this is mostly the same thing. A cheap swiper for your iPhone, plus some convenient software.
posted by delmoi at 1:06 AM on December 2, 2009 [2 favorites]

The reason you use a PIN pad with hardware encryption is because nothing else will run on it. Who the hell knows what viruses/trojans/keyloggers are going to be running on your barista's iphone when they swipe your card.
posted by PenDevil at 1:20 AM on December 2, 2009

mark242: "
You aren't. The hardware vendor is supposed to verify it with the PCI standards council. Having a piece of hardware that is not PCI compliant is essentially a nonstarter; companies won't (almost literally can't) buy hardware that isn't PCI compliant."

This reply misses the point by a mile. If you're worried about vendor fraud, relying on a standards council conveying compliance to vendors is absurd. The best reply in this area is that credit cards only hold you liable for the first 50 dollars of fraud. Your debit card on the other hand, is usually not so lucky.
posted by pwnguin at 3:45 AM on December 2, 2009

You cannot separate out the merchant processors requirement for standards-compliance from these issues. Each year you need to certify that your processing equipment/software is in compliance. And if you don't do it, you don't process credit cards. At *some point* these need to hit the real clearing houses ( FirstData, etc. ) and at that point, the technology is going to need to be compliant.

I think this is *interesting*, but not really gonna go anywhere. Our merchant account costs about 8 bucks a month with no usage, and the 'knuckle buster' imprinter we use was 25 bucks. Transactions are entered via IVR/VRU/touchtone on any phone. Our volume is low enough that the difference in discount rates for not swiping cards isn't relevant. YMMV.
posted by mikelieman at 4:39 AM on December 2, 2009

If it's PCI level 1 compliant (which Square claims) then you don't have to worry about it; your card info isn't actually on the dude's iPhone at any point past the initial swipe. (Presumably) the software immediately encrypts it and passes it to their centralized processor.

If? Presumably?

This isn't the MeFi I know and love.
posted by DU at 4:50 AM on December 2, 2009

Hey guys, what if the banks let us write our own gift cards to each other on slips of paper? Only instead you could send people any amount of money, and they could turn it into cash and spend it wherever they wanted? It'd be a lot more convenient than lugging all those gold coins to the dealer every time I want a new car.
posted by mccarty.tim at 6:24 AM on December 2, 2009

A popular burger truck in my area takes credit cards via a little swiper thingy on a cellphone. It's pretty neat. So, this tech seems like it's already out there, but putting it on a cute little white thingy for a cellphone seems like a winner. I think it could be awesome for touring bands selling merch at shows.
posted by statolith at 7:12 AM on December 2, 2009

4) Send .wav file

Or, just send your credit card number in an email. That's all you're really doing here, there's no need for the wav file obfuscation step. What you're saying here is that "people can accept credit cards for purchases if they have a merchant account" which is not in any way revolutionary. It still does nothing to compete with paypal where two strangers in different locations can transfer money without either of them seeing the other's credit card number or having to establish a merchant account.
posted by Rhomboid at 7:26 AM on December 2, 2009

I've had a swiper for my cell phone for over a year. Works great, though I rarely need it. I'm a massage therapist and people usually pay cash. Cash is good. :)

Prior to that, I worked for some time on a credit card processing software help desk for a very large manufacturer of terminals. If anyone ever tells you that their POS (point of sale, though the other meaning to POS may apply as well..) software is encrypted/secure, feel free to laugh your ass off. No such thing. There's always a back door somewhere. I damn sure don't miss that job either. /help desk refugee

And to whoever said Mastercard/Visa is evil.. FirstData is way more evil than either of them. WAY more.
posted by keptwench at 8:03 AM on December 2, 2009

Encourage enough stores to install read/write terminals, allow charges to be paid as a part of one's mobile phone bill, and work to ensure interoperability with other systems around the world, and voilà, you've got yourself a money-making machine.

That presumes telcos want to become banks. They don't.
posted by mr.marx at 9:37 AM on December 2, 2009

This is a hell of a lot better than my previous solution for doing shows (odinsdream mentioned buying a skein of yarn using the PayPal mobile technique...I've done that before and it works nicely when all parties involved have PayPal, but can break down pretty quickly if not). I had been using a portable credit card swipe that could store info offline and then batch it up when connected to a phone line again. The fairly low incidence of fraud -- I think maybe $40' worth the whole time my former company used it when I was there -- but ability to get people to spend more than the cash they had on hand was WELL worth it.

Farmers' markets, craft shows, mobile events of any kind...this will be a godsend. And given that ANY processing service is going to charge you something, I can't get too worked up over the fees unless they're well over the PayPal and merchant service fees already out there. The way I see it is this:

Person wants to buy $100 of my stuff but doesn't have the cash or a checkbook.

1. Person walks away and doesn't buy at all.
2. Person uses credit card and I end up with maybe $97, not counting any monthly fees or other nonsense charged by the provider.
3. Person uses PayPal and I end up with roughly $96.80
4. Person uses this new system and I end up with -- let's be crazy and say it's 6% charges -- $94.

I'm still ahead $94. I'm not going to bitch! The markup on my work is such that I'd rather have the $94 than someone walking away.
posted by bitter-girl.com at 9:51 AM on December 2, 2009 [1 favorite]

mccarty.tim: the credit card companies don't take too kindly to people who have separate prices for cash and credit or minimum totals for using a credit card (I don't think that's fair, as it targets small businesses that really can't afford to sell everything on a credit card).

Here in Georgia, there are many businesses I have had experience with who do this anyway. It has been annoying to the point where I have mentioned it to them once or twice, especially when it seems that a minimum transaction requirement is being used more of a way of increasing sales from harried customers than to make up for credit card fees. Most of them don't put up a sign warning of the policy, possibly to try to keep it a secret from the credit card company.
posted by JHarris at 10:53 AM on December 2, 2009

Fuck this shit. I'll never ever use this at my stores. People, people, PLEASE pay your small businesses in cash.
posted by vito90 at 11:23 AM on December 2, 2009

Most credit card companies forbid businesses from charging fees or tiering prices based on method of payment. The only commonly accepted workaround is to place a minimum purchase required to use plastic rather than cash.

To vito90: that's completely your choice. But there are many who view taking credit cards as a necessary convenience to shopping somewhere and doing so can allow purchases that one might not normally make if they needed to take an extra trip to the ATM or plan ahead on how to give you their business.
posted by cgomez at 11:55 AM on December 2, 2009

Don't most credit-card companies also forbid minimum purchase requirements?
posted by box at 3:22 PM on December 2, 2009

Don't most credit-card companies also forbid minimum purchase requirements?

I'm pretty sure the minimum purchase rules are implemented by merchants who don't want to pay a $0.35 on a small charge. The banks don't care.
posted by Burhanistan at 3:24 PM on December 2, 2009

My impression was that the credit-card company contracts prohibit it, but that this rule is very rarely enforced. I could definitely be mistaken, though.
posted by box at 3:49 PM on December 2, 2009

That presumes telcos want to become banks. They don't.

No. That presumes telcos (or rather, wireless providers) want a percentage of all electronic money transactions made via mobile phones, just like credit card companies do. And they do want that.
posted by armage at 5:05 PM on December 2, 2009

But just in case you don't think they might want to become banks, too: Jibun Bank Corporation Obtains Banking License.
posted by armage at 5:07 PM on December 2, 2009

Customer: I'd like a coffee please
Clerk: that will be $3
Customer: [hands credit card]
Clerk: swipes card on Itouch and hands it to client to sign with finger
[in process of handoff client drops Itouch on the hard concrete floor shattering it]
Clerk: That will be $278 and you'll have to pay that in cash.
posted by any major dude at 6:35 AM on December 3, 2009