Accountancy software company FreshBooks has launched its new credit card reader to let U.S. merchants accept credit card payments through a smartphone. The full publich launch follows a short invite-only period.
First announced back in December, the $29 pocket-sized contraption sees FreshBooks go up against incumbents such as Jack Dorsey-owned Square, a company that went public on the New York Stock Exchange three months back.
Similar to Square, FreshBooks’ unit plugs directly into an iPhone’s audio jack, and is designed to help small-to-medium sized merchants go “cash-free” by accepting most of the common bank payment cards.
Above: FreshBooks: Card Reader
Image Credit: FreshBooks
Founded out of Toronto, Canada, in 2003, FreshBooks is better known for its cloud-based accountancy software, including invoicing, expense-management, and time-tracking tools. And this is why its move into mobile payments didn’t intuitively make sense at first. However, the card reader integrates with FreshBooks broader software offering, meaning that merchants’ invoices and financial reports will be synced in real-time when each payment is processed.
Indeed, the company launched an online payments service the previous year, so expanding this into physical stores made sense. Ultimately, it’s a value-added service that the company will not only offer to its existing customers across the U.S., however, it will be used as leverage to lure new clients on board.
In addition to the $29 up-front cost for the card reader, merchants will be charged 2.7 percent + $0.30 for each Visa and MasterCard transaction, while American Express (AMEX) will cost 3.4 percent + $0.30. The reader will accept both the new security-focused EMV chip cards and the old-style magnetic-stripe bank cards.
FreshBooks’ card reader will only work on iPhones and iPads at first, however the company previously confirmed to VentureBeat that support for Android will follow afterwards this year.