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Square launches Apple's Tap to Pay in Point of Sale app

Sep 29, 2022
A phone with a dollar bill as a screen.

Illustration: Sarah Grillo/Axios

Square, the merchant payments platform of Jack Dorsey's Block, announced that its Point of Sale app now makes Apple’s Tap to Pay technology available to sellers.

Why it matters: The launch lowers the barrier to entry for merchants to adopt Square's platform, enabling them to accept contactless payments with no additional hardware necessary.

How it works: Through the Square Point of Sale app, any merchant with a compatible iPhone will be able to accept Tap to Pay payments from other iPhone users and other NFC-enabled phones and cards.

  • In addition to Apple Wallet, the technology accepts payments from Google Pay and Samsung Pay for Android users, as well as contactless credit or debit cards.

Flashback: Apple announced Tap to Pay in February, with Stripe and Shopify as its initial launch partners.

  • At the time, some analysts saw the tech as a possible challenge to Square’s business, leading to a quick sell-off of Block shares.

What we're watching: The availability of contactless payments could cut into Square's hardware revenue but ultimately lead to higher profitability.

  • In the second quarter, hardware sales reached $48 million, which was up 10% year-over-year and 29% on a three-year basis.
  • Hardware is a loss-making business that Square uses as a merchant acquisition tool, however, and generated a gross loss of $35 million in the quarter.
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