Square Launches In Australia

Square is expanding its global footprint with the launch of its suite of POS solutions in Australia — its fourth market so far, the company announced.

The company has partnered with Cuscal, an Australian transactional banking services company that has maintained its presence in the local market for over 40 years.

“With Square Reader in Australia, we’re empowering local sellers with the tools they need to start, run and grow their businesses. This is an important step for our company and an exciting moment for a market so committed to innovation and an entrepreneurial small business community,“ said Jack Dorsey, CEO of Square.

While, in the U.S., Square offers free card readers and charges 2.75 percent per transaction, the company has taken a different approach in the Australian market, with a 1.9 percent transaction fee that is stapled to a $19 Square reader, according to The Sydney Morning Herald.

“Square has brought a fantastic new product to market, which we think will help thousands more companies offer a better payment experience to their customers,” said Craig Kennedy, managing director of Cuscal.

Even though Square might be aiming at repeating its American success story in Australia, it might ultimately prove to be an uphill battle. Unlike, in the U.S., where Square had an early-bird advantage with its 2009 release of a stamp-sized Square reader, the company is entering the Australian market with competition from international players, like PayPal, and domestic players, like Mint Payments.

The company is also expected to face stiff competition from local banks, as banking consultant Grant Halverson of McLean Roche told SMH. “The Aussie banks are well-embedded with retail merchants, not just with card acceptance but often tied up with business loans, mortgages and related products,” he said.

“So, in my view, it will be a tough sell, hence the need to have sales folks. You just can’t use the Internet as your only channel,” he added.