
The End of the Credit Card? New Square app: Card Case - qxb
http://www.slate.com/articles/technology/technology/2011/11/card_case_the_new_payments_app_that_could_make_cash_and_plastic_.single.html
======
patio11
That is what disruptive innovation looks like. "Oh look, a multi-billion
dollar problem people were trying to solve by getting two sides of the market
to simultaneously ubiquitously install new hardware. How about we solve it
with stuff they already own plus new software instead?"

~~~
thinkcomp
I respectfully disagree. This is what an investment from Visa looks like with
really good design. Not everyone was trying to get both sides to adopt new
hardware, either.

As long as Square uses cards for funding, it will be robbing the poor to pay
the rich just like every other card company. To me, "disruptive" in the
payments world means no cards, period.

~~~
reissbaker
What were the non-hardware non-card payment methods attempted? I'm familiar
with NFC, and somewhat intimately familiar with Square and its card-based
rivals, but the only alternatives I know of are those pay-through-your-carrier
attempts that are an even bigger can of worms than a card company. Were there
others?

To reference your Visa point (which I suspect wasn't serious), Square was
card-based long before the Visa investment.

~~~
thinkcomp
Starbucks (for payments) and the airlines (for boarding passes) have done
pretty well with barcode scanners. It requires hardware only on the merchant
side than most merchants already have in one form or another.

~~~
reissbaker
Er. But unless you've given Starbucks direct access to your bank account,
those are fundamentally card-based too.

~~~
thinkcomp
Not quite. Starbucks uses its own pre-paid system that does use a plastic
card, but one without any major network's logo on it. It's just store credit.

~~~
vidarh
So worse than both cash and cards - suddenly you have to have small balances
sitting on multiple proprietary cards. No thanks.

------
Cherian_Abraham
I love Square, and they are a classic disruptor. They started slow, at the low
end, and created their own blue ocean before starting to chew at the heels of
the entrenched incumbents in the payment ecosystem.

That being said, the payment ecosystem is a pretty messed up place, even
though the ugliness is all pretty much abstracted from the customer. The
interchange fees charged to the merchants at times rival their margins on the
items they sell. And it got ugly because it was essentially a duopoly and the
stakeholders including Acquirers (MC, Visa etc) and the Issuers (Credit Card
Issuers) and the POS vendors all had a pretty good reason to keep things the
same.

When things are messed up because we do not have enough choice, do you think
it would be preferable to hand over the keys to this to a single player - in
this case Square? If Square controlled both ends, owned the customer as well
as the merchant POS, and cut off everyone else in the process (by going
directly to your bank account), then how long before Square starts bumping up
the fees it charges each merchant? Couple that with the fact that Square will
own the customer, and is in control of delivery of targeted merchant offers,
and you get a sense of the size of the pie they would like to own. Anyone
agree if that is a good thing? I certainly dont.

The reality is, the ecosystem will be a lot more fragmented this time around
than it currently is. The various mobile wallet initiatives (and there are
over 70) will eventually coalesce around a few major players, but we will be
using NFC driven mobile wallets (GWallet) and Cloud based mobile wallets
(Paypal/Square) and the traditional plastic form factor for a long time to
come.

Square is a disruptor. And they have created a beautiful customer experience
and has spurred the reinvention of the check out process. They inspired
several, including me, to see how the status quo was so messed up.

~~~
refulgentis
As a founder of new POS system company (Ambur iPad POS), I just don't see this
as true. Most of the bigger POS companies might have reasons to maintain the
status quo, but mobile touch devices are literally revolutionizing the
industry, because it means there's opportunity for small players to build
systems on commodity touch hardware, designing software that's actually easy
to use and reasonably priced.

Square needs to allow other POS vendors to use their APIs to truly conquer
this space. Their system is currently woefully inadequate for anyone except
small businesses with literally no need to do anything except charge a
customer right away, without any paper receipts. That limits their business
market to essentially small coffee shop or retail vendors with technologically
advanced customers. That's a...small market, to be polite.

------
Figs
> Paying for stuff with your phone sounds awesome until you stop to think
> about it.

Uh, it doesn't sound awesome to me at all. It sounds annoying and frustrating.
Swiping a credit card is already pretty simple.

> then tell the cashier your name

Yeah, because that works great. My name is fairly common, and cashiers still
manage to get it wrong, especially if it's noisy. Also, what happens when
three "John Smiths" walk in?

EDIT: They do address the multiple "John Smiths", missed that in the article.

> For instance, because Card Case can notify a coffee shop when you walk in
> the door -- and because the cashier can see your profile, and can see that
> you usually get a medium mocha and a croissant -- the barista can get your
> drink started for you while you’re standing in line.

If a restaurant's going to go to all the trouble to install a system like this
and set it up so that my phone can pay them, why couldn't I just order on the
phone? Then I wouldn't have to stand in line at all, and they won't have
wasted their time if it turns out that I want something else instead of what I
usually get.

~~~
dpark
> _If a restaurant's going to go to all the trouble to install a system like
> this and set it up so that my phone can pay them, why couldn't I just order
> on the phone? Then I wouldn't have to stand in line at all, and they won't
> have wasted their time if it turns out that I want something else instead of
> what I usually get._

Because a smooth face to face interaction is much more pleasant than ordering
via an online application. "Half-caff mocha, large, with extra whip cream" vs
"open web site, look for mocha, select size, special request... extra whip
cream, agree to pay..., submit". That's a crappy experience. The online order
only makes sense if the face-to-face experience sucks worse, which shouldn't
be the case.

Also because this system doesn't require you to get out your phone every time.
Just once, and then it works transparently.

~~~
wanorris
Ordering a saved pizza order that we order frequently at Papa John's is
incredibly easy -- certainly way easier than telling the order to someone.

I suppose it's possible that coffee is different in some non-obvious way, but
I'm not sure how.

~~~
dpark
Pizza's different because it takes 15 minutes for them to make it. It's not
really a choice of going to the store to order vs using an online form. It's a
choice between calling and using an online form. Calling is already fairly
impersonal, and on top of that you normally end up on hold, then you have to
read them your credit card number, etc. Online ordering can indeed be less
hassle than calling in an order (at least after the initial hassle of setting
up an account).

Let's also not forget that Square is presumably not just targeting coffee
shops and restaurants with this. You can take a sweater to the register and
pay with card case.

------
Adolph_Jobs
<token dude posting about privacy issues>

This is amazing in terms of ease-of-use. However, the privacy implications are
a bit worrying...

I don't really want to rubbish this, I hate the naysayers when something
disruptive comes around (note that Japan rolled out pay-by-cellphone on their
subway systems something like 10 years ago) but...

"She saw my name and photo on her iPad, tapped it, and I was done. A receipt
was sent to my phone."

So all employees at stores using Card Case can see the name, identity and
photo of _every single person_ using card case within a _100 foot radius of
the store_. Completely regardless of whether they want to buy something or
enter the store. What if you don't want random stores to know when you walk
past? What if your abusive ex-husband is working at a store and sees your name
come up on the list.. etc.

Additionally, if you use the app, Square knows exactly where you are at all
times. I'm not at all comfortable with that. Apple had a massive scandal when
it was revealed that it's technically possible to retrieve location history
from iOS. This is legit human tracking - police and three letter agencies
everywhere are probably throwing parties right now.

HN was up in arms when retail giant Westfield was tracking number plates
entering their car park. Just number plates.

</token dude posting about privacy issues>

~~~
notatoad
the privacy issues are negated by it being totally opt in. the other examples
in your post are silent, unauthorized tracking. obviously there are privacy
concerns with a system like this, but if that is something that worries you,
you can control it.

~~~
jerfelix
I still would like to be able to buy coffee without having to announce my real
name out loud to everyone around me.

Cash provides me that privacy. Heck, credit cards even keep the transaction
between me and the merchant.

~~~
Karunamon
Oh for crying out loud...

I understand the privacy concerns, but this isn't a secret agent movie. I'm
reminded of that scene from Jurassic Park..

Nedry: Ooh! Dodgson! _he sits down_ Dodgson: You shouldn't use my name. Nedry:
(loudly) Dodgson! Dodgson! We have Dodgson here! Nedry: Nobody cares. Nice
hat. Trying to look like a secret agent?

~~~
jerfelix
I can think of several reasons besides being a secret agent that I wouldn't
want my name announced.

Say I am meeting someone that I wouldn't want to normally be associated with -
whether it's for a job interview or a personal meeting.

Or say I plan to pick up a Playboy magazine at the same counter.

Or say I'm a cute woman, and I prefer not to be stalked.

Or say I don't want that sales guy over there to come up to me and pretend to
know me.

Or say I was just overheard saying that my kids are all alone at home.

Or say I just got out of an expensive car.

Or say I was having a bad day and complained loudly.

Or say I farted.

Or ...

I could go on and on.

~~~
jerfelix
OK so I don't announce my name. Maybe I can just hand the clerk a card with my
name on it.

Perhaps a credit card.

------
6ren
A malicious cashier could order things in your name, whenever you were nearby.

This might not happen much in practice, because the cashier would be found out
later (assuming they must login). However, the opportunity doesn't arise with
existing transactions, where you must physically hand something over
(cash/card), and usually get an opportunity to verify the amount, so there's
no evidence either way. It will be interesting to see if this is actually a
real issue, in practice, in the current roll-out.

Many, many cash-alternatives have been tried and failed, but this one has a
new technology (iPhone geofencing) and smart founders. If it does work, they
could quickly revolutionize cash - globally (not to mention be _the_ killer-
app for the iPhone).

~~~
ig1
It happens all the time with credit cards, the practice is known as "skimming"

<http://en.wikipedia.org/wiki/Credit_card_fraud#Skimming>

~~~
fauldsh
But it would be so much easier with this new system, they're told all the
information they need and will have to enter legitimately, rather than having
to use 3rd-party hardware.

~~~
ricardobeat
Then they get kicked out of the program.

------
Osiris
What I find the most fascinating is that the same company is running both the
seller and buyer sides of the transaction. Without middlemen, they have a lot
of flexibility to determine how the transaction should occur. Right now credit
cards rely upon a fairly complex system of gateways and processing and so it's
really complex and difficult to change the process.

I wonder if a security feature they could add would a two-factor
authentication where your phone would display a one-time use auth code that
you'd give to the cashier to approve the transaction, for those that are
worried about automatic billing.

~~~
patio11
Rather than attempting to have minimum wage employees and average netizens
understand what one-time use auth code means, how about we just pop a window
on their phone saying "Krispy Kreme wants to charge you $5. Hit the big green
button."

~~~
abraham
People understand debit card pins just fine. As long as they get labeled as
such there won't be any confusion.

------
rs
This does look interesting, but TBH, I don't think its the end of credit cards
per-se. One main reason:

What if my phone's battery is dead ? Does that mean I can't buy anything ?
What happens in an emergency ? Credit cards are easy as they're quite low tech
physically (a magnetic strip, a chip and some plastic).

Other things would be stuff like: not everyone has a phone, but would still
like a credit card, etc. There are countries where phone penetration (and not
even smart phone) is not very high, but the population still need to have
credit cards.

Granted, I can see it being used as an alternative, but doubt it will be the
"end of credit cards"

~~~
dasil003
> _What if my phone's battery is dead ?_

Go to an ATM.

> _There are countries where phone penetration (and not even smart phone) is
> not very high, but the population still need to have credit cards._

There are also countries where SMS payments are much more popular than credit
cards. It's not a one-payment-system world.

~~~
rs
> Go to an ATM.

Exactly, and you end up using a "card" anyway

~~~
dasil003
Okay then smart guy, go to a bank teller.

Using a card on the extremely rare occasion that you forget to charge your
phone is a world of difference from using it 10 times every day.

------
akavi
If this works, Square will join the narrow ranks of companies who I want to
succeed because my life would be dramatically worse without them.

Please let it work.

------
refulgentis
I am the cofounder of a startup that builds an iOS/iPod/iPad POS Ambur, and
it's absolutely astonishing to me to see people claim Square is doing anything
useful for merchants.

Their software is far too simplistic for anyone running more than a very basic
coffee shop with tech savvy customers to use. Even something as simple as most
customers _demand_ paper receipts, and Square's functionality is taking basic
orders, one a time, with no conception of any business analysis functions.
That does not cut it for any business bigger than a small coffee or retail
shop, where customers pay and are served instantaneously. no matter how cheap
Square is, or how many brilliant designers they hire, they're not going to get
into businesses bigger than this without expanding what they're doing.

They really, really, need to launch a platform for people like us to innovate
on. We're young, forward-thinking, and as an ex-restaurant employee I know how
much CC companies and traditional POS companies screw businesses.

We're trying to change that on the POS side, and I desperately wish Square
would be less egotistical and let us use them to change the payment side. It
would be tremendous for them, because it lets POS companies solve adoption for
them, instead of them trying to engineer 1000 solutions for 1000 different
types of business, and let's them focus on their core compotency - beautifully
designed software for consumers.

~~~
huhtenberg
Wouldn't adding a "Print receipt" button on a merchant's device solve the
"cusomters _demand_ receipts" concern?

And they _are_ building a platform. They will likely to open it up sooner
rather than later too, they just can't take on CC companies alone.

~~~
refulgentis
Nope, unless you want to integrate with a receipt printer manufacturer, and
now all of a sudden you're beholden to that - there's many technical issues
because now you need a preferred router manufacturer too, so the iPad can talk
to the printer.

Sure, I've been hearing forever that they must be going to, eventually, etc
etc. hasn't panned out and it's been literally years

------
ryanwaggoner
But I heard that Square was totally irrelevant because they were only
"innovating" based on the outdated paradigm of the credit card system.

/sarcasm

Don't confuse where a startup is today with where they're headed. Sometimes
you have to tack against the wind to get to where you ultimately want to end
up. The best startups are those that can make money while also setting up for
a huge play that no one else is positioned to pull off.

------
plasma
Very cool.

This also brings with it a new source of analytics and marketing opportunities
(for better or worse?).

A coffee shop cashier could be told (through product suggestions on the iPad
they use) that you've missed your regular lunch up the street and to offer you
something to eat.

Online ads could now be targeted towards you further, based off what you
purchased in the real world (that coffee and muffin) because the purchase was
matched to you, and your iOS Device ID.

A new round of marketing is possible by tying in real world/daily purchases
and being able to push that information back to retailers (in the form of
product recommendations or analytics for them), as well as advertisers.

------
Yhippa
Is this really the end of the credit card? It sounds like an abstraction layer
for payments. The backing money used to pay will still be some sort of payment
source like a credit card or debitable bank account.

~~~
JoshTriplett
As you said, "credit card or debitable bank account"; you already mentioned
one way this could avoid a credit card. Now consider that Square controls both
ends of the transaction. So, _any_ payment source Square chooses to support
will work: credit/debit card, bank account, some pre-paid account, line of
credit with Square for which you get a bill later...

------
koevet
I like the idea, minus the client tracking feature. I hope that they will add
a opt-out for clients who don't want to be tracked (so basically every time
you walk into a store, you are like a brand new customer, system-wise).

Also, I have some doubts about the human face recognition bit. Will it work in
a crowded environment, with stressed-out clerks? Phones get stolen all the
time and it doesn't sound too remote that someone picks your phone and walks
into a shop with a big pair of shades and a 4 days beard.

------
vsl2
My questions regarding Card Case:

1) How is it going to move away from being based on credit cards?

Most savvy people I know use credit cards wherever possible because of the no-
liability fraud protections that are not present in debit transactions.
Clearly, Square users are younger and savvier than the general population. No
way should anyone use bank account-based payments on a mobile device that
could be stolen/hacked/lost because you're not going to get the money back
that is fradulently charged.

2) Do you really want to have a shopping experience where store cashiers and
other customers standing around know your name?

Most people I know would prefer to remain more anonymous than that.

3) Where is the verification of customer payment (e.g. signature on CC
receipt)? What happens when there are customer chargebacks?

4) Is it really that hard to pull out and use a credit card?

I'm all for improving the current payments environment where a few major
companies (Visa, MC, AMEX) dominate and as such, are able to extract large
fees from merchants (which get passed along to consumers), but I don't see
Square (or anyone else) as having found the answer yet. Their attempts seem to
be more "cool to have" and technologically impressive than actually solving
the underlying inefficiencies in the payments industry.

And frankly, the major credit card companies are going to come out with their
own NFC apps at some point and if Square is still relevant, they'll be just
another player in the oligopoly (but still dependent on the others' back-end
processing component).

------
pbreit
The Square dongle is the most brilliant customer acquisition tool in the
history of marketing to small businesses. But Square probably needs to also
offer a swiping solution that makes more sense in a permanent location like a
physical store. And it should also acknowledge that customers are going to ask
for a paper receipt for some period of time. Not every retailer is Apple.

Getting rid of the flat fee that traditionally accompanies credit card
transactions was also a smart move to further open up new credit card
processing markets.

The Card Case? I'm not sold in its current state. This article, like pretty
much every article describing the latest "wouldn't it be great" payment
product story, describes a process that sounds quite a bit worse than a simple
swipe of a 2mm thick plastic card.

~~~
sliverstorm
I wouldn't say they "got rid of the flat fee". They are offering an
alternative. The flat fee is not about to go the way of the dinosaur- it is
still the more favorable option for clients processing large transactions.

~~~
pbreit
I was referring to the $0.15 that Square used to charge for each swiped
payment in addition to the 2.75%.

------
hugh3
My problem with all of these systems is the same: I'm disorganized, I forget
to charge my phone or bring it along, and so the chances of me having a fully
charged, working, switched-on phone with me when I want to buy something are
far lower than my chances of having a wallet.

~~~
Lewisham
This is certainly the case in the US, where you're most likely to have driven
somewhere, so you're going to have your wallet/purse as you need your driver's
license.

That said, there is still _some_ friction when it comes to using a card...
some places want you to sign, some don't, some decide on the day... people
offer you a paper receipt for a $2 transaction ("No, I really don't need
it.")... it's sometimes finicky trying to deal with a wallet full of cards...
It's all not all that much really, but there is still room for improvement.

What I really like about this is the end-run around NFC. NFC really doesn't
solve the problem, because is is just as easy to pull out a wallet as it is to
pull out a phone. Here you don't need to rummage, you say what you want and
go. That's 15-20 seconds of your life back per transaction.

------
trjordan
So, this is cool, but...

Why do you have to have a smartphone to do this? If you're going to get
businesses on board and use photo IDs to verify every transaction, why not
just have the signup process be a webcam and a form?

There's a couple of cool usability things you can do with a smartphone
(proximity pushes users that are there to the top of the list in case of name
conflicts, whether it's from geofencing, manual inputs, or side-channel geo
info), but the basic idea of registering for a store doesn't seem that novel.
Why not slap a decent search UI on it and give all the cashiers iPads?

Is this idea so novel that nobody thought you could look up a name and photo
via the web at point of sale before today? And if the idea isn't novel, why
hasn't anybody successfully executed it?

~~~
dasil003
Because you don't want a bunch of stores to be able to charge to your account
when you're not there.

------
sp332
This reminds me of "The Future of eBusiness" from 1999
<http://www.youtube.com/watch?v=xnwaFxFru5k> Funny it took so long to get
here, and that Square beat IBM to market :)

------
thinkcomp
It's ironic to see this article coming from Farhad Manjoo.

I wrote a response to his original piece a while ago:

<http://www.aarongreenspan.com/writing/essay.html?id=51>

What Square has done with card case is pretty slick, but at present it doesn't
scale. Paying with your name doesn't work at Wal-mart. And funding with your
plastic credit or debit card doesn't work especially well for most coffee
shops or other small businesses that want to save on interchange fees, not pay
more of them.

I look forward to competing with Square again when I get my California
license.

~~~
gojomo
Why wouldn't it scale to Wal-mart? Even with a dozen people with the same name
in the store, a cashier can quickly pick a matching face: everyone is good at
that (except for prosopagnosics).

And that's without assuming Wal-mart adds any extra hardware that could narrow
the position of handhelds to individual registers.

~~~
thinkcomp
That's a pretty long scroll box to find the person in the first place. Or an
added step as you key in the first few letters of the person's name. At large
retailers or QSR chains that put a premium on fast checkout, neither option
will fly.

I obviously appreciate the simplicity of paying with your face.

~~~
gojomo
I doubt any firstname+lastname (or even just firstname+last_initial) situation
would require a scroll box... you could fit 20+ recognizable faces on a
screen. Sort them by age and in the few cases where there are that many
collisions, cashiers would know just where to look.

Keying the name is a bigger issue... so I suspect terminals in larger
retailers will eventually just detect the N nearest pay-eligible handhelds.

~~~
thinkcomp
The additional hardware (plus integration cost) is something that reatilers
don't want to spend on.

In contrast, barcode scanners are already there and they typically emulate
keyboards, so no special integation is required.

I'm not convinced that paying with your name scales for most retailers. The
retailers I've talked to aren't convinced, either.

~~~
gojomo
Barcode scanning is another good option to speed the initial account-
identification.

I suspect in coming years, multiple systems will all work together to train
users to bring up barcodes on their handhelds for specific purposes (as with
boarding passes or "Jonathan's Card").

------
jakeonthemove
It's also pretty interesting to see them build a whole new payment system
using normal everyday tech like smartphones and tablets (plus of course remote
servers). No expensive custom mainframes and ancient software. The trick now
will be to get as many businesses to use it (preferably all of them and
preferably worldwide).

I also think using photos is one of the most surefire ways of identifying the
buyer, as well - it had a nice effect on credit cards (with photos on them,
you can't just steal one and use it for whatever) and it can definitely help
curb fraudulent purchases with Card Case.

~~~
thinkcomp
You might also like FaceCash (<http://www.facecash.com>).

------
hsshah
Card case is elegant and innovative. As a user, I love it. However, calling
this a harbinger of end of credit cards is jumping the gun. If that would have
been easy, PayPal would have already ended credit cards (for online
purchases). I see no signs of that.

A completely different set of competency and technology will be required to
replace the credit cards with their own payment solution (credit risk
assessment, fraud prevention etc). Their impressive track record so far means
they can certainly develop these; but it won't be that quick or easy.

------
jerfelix
Almost 100 comments, and no one mentions Bitcoin. I'm surprised.

Seems to me this same app could be built for Bitcoin, and you could eliminate
or reduce the 2.75% service fee. Or you could make it 1% and give it back to
the purchaser in the form of points (like credit cards).

Bitcoins could be instantly converted to cash, for a fraction of that fee
(about 0.6% using a Bitcoin exchange).

------
hansy
When I turned 16 and was excited to drive everywhere, I would volunteer to
pick up groceries for the house. My dad would give me his credit card so I
could purchase the groceries.

How would a similar scenario play out in the Card Case universe? I wasn't
allowed to have my own credit card until college and I would never use my
debit card for common house purchases.

~~~
corin_
It's designed as an additional way to pay, not a replacement for cards. So in
your scenario you still take your Dad's card, you don't take his mobile phone,
and hey presto you can pay like you always could.

------
fauldsh
So every time I buy something I end up declaring to every-one in the shop that
I have my smartphone on me, not only that but I publicly tell them everything
they need to buy stuff from that shop if they did manage to get my phone?

Chip-and-pin means I rarely carry cash, I don't really see this as an
improvement on putting my card in a reader and entering my pin.

------
dminor
I have to admit when Square first came out I didn't see what the big deal was.
A little doohickey to plug into your iPhone to swipe cards - sure, sounds
useful for certain merchants, but not something world-changing.

It's cool to see that there's a larger plan unfolding. Credit card networks
are tough nuts to crack and it looks like they've found a way. Kudos.

~~~
listrophy
The mind-blowing thing, I see, is that—with that little doohickey—Square has
single-handedly broken bistromathics[1]. And yes, you can take this comment as
a joke, or you can take it seriously.

[1]:
[http://en.wikipedia.org/wiki/Bistromathics#Bistromathic_driv...](http://en.wikipedia.org/wiki/Bistromathics#Bistromathic_drive)

~~~
mechanical_fish
Holy cow, Square is going to have all the pieces to build the ultimate
restaurant-bill-splitting application of our dreams.

Card Case doesn't happen to have an API, does it? ;)

~~~
pbreit
Do people really dream of such a thing? Some at PayPal thought bill-splitting
would amount to something which was of course foolish.

The difficulty and hence lucrativeness of financial transactions depends on
size, distance and familiarity. A large transaction across the world between
two strangers is the riskiest/hardest/most expensive. A small transaction
face-to-face amongst friends is the opposite.

------
zobzu
On the other hand:

\- anyone in the room knowing your name can get free cookies (or anything
else) \- signal travel through air, so physical hack is not necessary anymore
\- its still tied to your phone ;-)

the rest is pretty cool, but i'd like to confirm manually each transaction
thank you very much. I want to keep control of MY stuff, my money, my phone.
My my my.

------
mechanical_fish
Hmm, perhaps I need to find the time to become an Apple Developer and sign the
NDA, for much the same reason that folks who want to write screenplays move to
Hollywood: To find out what the industry is going to do, years in advance.

Geofencing is a big deal and I first heard of it... today. How long have iOS
devs known? Since WWDC?

~~~
jarek
I'm pretty sure everyone that reads Engadget only on Big Apple Days, let alone
more invested users, have known. I haven't coded a line of obj c in my life
and I've known about it for a couple of months.

------
cynusx
What happens when the merchant doesn't care he's paid by the right customer?

How does the system handle the common use-case where you give a third party
(wife,friend,kid,..) the money to go and pay the bill.

Both Facecash and now Square Card Case have this problem, but maybe I have
missed something.

~~~
vidarh
> What happens when the merchant doesn't care he's paid by the right customer?

Same as with credit cards: There'd be lots of fraud complaints. Square will
realize there's a problem and depending on what their contracts look like
they'll either charge them heavy fees and/or fine them to fund having to deal
with the fraud, or cut them off.

Credit cards has this exact same problem. Physical control of the card pretty
much gives you free reign to pay for stuff - most shop staff can't even be
bothered to look at the signature or ensure the name has any chance of being
yours.

> How does the system handle the common use-case where you give a third party
> (wife,friend,kid,..) the money to go and pay the bill.

The article states the current app already allows you to press a button to
pay, so presumably you just forgo the convenience and make them press the
button if their face doesn't match up.

And/or add a way of adding additional authorized people whose images will show
up.

------
jwallaceparker
Sounds interesting. But also a bit risky compared to a credit card, which to
me isn't a hassle to use.

And does it offer reward points?

If not I'll stick with plastic.

~~~
JonWood
Presumably it's still backed by a card of some form, unless Square are picking
up the tab for anyone using card case, so you'll get reward points when the
transaction gets processed by Square.

------
wolfish
What happens when your chilling in a coffee shop and your arch nemesis orders
a latte with your name?

~~~
notatoad
the article specifically mentions this problem. you should try reading it.

~~~
dredmorbius
Ok, so I'll raise the ante.

What happens when you're chillin' on the street, and your arch nemesis has
hacked your favorite coffeeshop's PoS system, nabbing your account details,
phone identifier, and photo, and proceeds to stalk you all over town from a
distance of 100 feet?

~~~
corin_
What happens when your arch nemesis has hacked your favourite coffee shop's
PoS system right now and proceeds to steal all the credit card numbers that go
through it... how is the new scenario any worse?

~~~
dredmorbius
As weak as credit card numbers are as a security measure, the countermeasure
defense is largely for credit-card issuers (and/or the processing networks) to
monitor traffic very heavily for anything vaguely resembling fraudulent
activity. Cardholders are largely protected by law (though merchants aren't).

The special sauce here is the location tracking. The system seems to assume
that vendors are at a fixed location, but there's probably no reason a mobile
device couldn't be constructed that functions as a PoS, and with hacked
data/credentials, it could be used for tracking purposes. Say, with a number
of confederates (or a good make-up job), charging stuff to your account while
you're in the area. Or insert intelligence, criminal, stalker, jealous ex,
etc., scenarios.

I'm increasingly in favor of cold hard cash for transactions rather than
divulging my personal information in ever increasing amounts and rates.

------
pnathan
I am looking forward to the IPO. I expect big things from Square.

They are really kicking butt.

------
callmeed
I use card case at one of our local coffee shops in SLO. It's pretty slick.

------
the_grind
What prevents competitors from creating their own app that does this? If this
takes off and Square charges X percent, I assume that Competitor Y will
develop a similar app and charge X-z percent. I'm having a hard time seeing
the barriers to entry for this particular approach.

~~~
shalmanese
Because they own the POS. You can theoretically have multiple apps installed
on your phone but a store is only going to be running one piece of POS
software. Because Square got a toehold into the POS market, they can leverage
this for network effects. Stores are going to want the POS with the most users
installed, users are going to want the card case accepted by the most POS
systems.

------
georgieporgie
Not that this isn't neat, but regarding the opening:

 _Wait a second: Why is this supposed to be any better than pulling out a
credit card? It’s not faster, it’s not more convenient, and it’s not any
safer._

Yes it is. Just having an RFID card + POS reader is awesome. Putting the chip
into a phone _is_ even more awesome. If you don't believe me, move to Japan
for a few months and live the dream. ;-)

------
Causification
Are there really people that walk around with their phone GPS switched on all
day? Security concerns aside, what a drain on battery life that must be.

------
rzbn
Jack Dorsey is going to be one of the biggest innovators of our time. 2 huge
companies already in his belt

------
suivix
I just bought buffalo wings from next door using LevelUp on my phone. It's
fantastic how they offer that service, you'd never expect it because they're a
little pizza shop. LevelUp uses QR codes and you can quickly scan it. They
have this phone-looking thing set up with the camera facing out, and you just
hold your phone in front of it to pay.

