I cannot say as though I am a tremendous fan – at all – of turning your cell phone into a stand-in for your credit card, but even I have to admit that Square’s solution to this apparent market demand is pretty slick.
We have actually used the original Square system once before, as customers, and were largely impressed with the simplicity and ease – the vendor (in this case, a butcher) had the little dongle attached to his phone, he punched in how much we owed him, we swiped the card and punched in my cell phone number, and a few minutes later the system texted a receipt to my phone, and the charge posted like any other. That 2.75% per-transaction fee to Square sounds like a lot, but in reality, that is about what most credit card transaction companies charge merchants to allow them to swipe your card – you just never see it, since that charge is just rolled up into the shop’s cost of doing business.
And now, being able to run a "tab" at the stores and shops you frequent that automatically charges your credit card, without having to pull out a wallet, phone, or anything else? Yeah, that is kind of impressive technology, despite the inherent flaws in a system that puts your money payment capabilities on an easily hackable, traceable, and hijackable piece of hardware.
From a purely UI perspective, though, it surely would be nice if Square offered some kind of map/listing on their webpage indicating how many merchants in your area use this tech, so you do not have to download the program and probably provide it all of your interesting, personal information before it tells you that you are out of luck due to living in Podunktown. Of course, that could be the point…