In a move exemplifying efforts to move more cash and check payments to credit and debit cards, a national social network of babysitters and parents called SitterPals.com has signed up to use Square Inc.’s service to accept credit card payments for their services, the company announced Aug. 31.
Square’s card reader attaches to a mobile phone and enables a sitter to collect payment for services.
The online babysitting network, which launched in April and is available nationwide, sought to make the payments process easier for sitters and parents, Amanda Armstrong, SitterPals.com president, tells PaymentsSource.
Square launched its card reader and service in December 2009 (
“When there was so much attention on Square, it dawned on me that babysitting is a mobile business, too,” she says. “Our sitters are like independent contractors who often get paid in cash, and as a parent I know what it’s like at the end of date night to have to figure in the extra time and hassle of providing a cash payment.”
Sitters may sign up for the Square payments service and receive a free card reader and payments app by checking a box on the SitterPals.com website. Existing sitters with Sitter Pals may register for Square when they log in the site’s Welcome Page, Armstrong explains, though she declined to provide the number of sitters currently in the network.
Square’s transaction fee to accept credit cards is 2.75% of the sale, though Armstrong says it is worth it for sitters to accept cards because it is so convenient for both parents and sitters. Most nights out cost between $50 and $100, so the amount the sitter pays is only a few dollars, says Armstrong.
In addition, using Square takes the awkwardness of payment time out of the equation, says Armstrong. Often it is difficult to finalize cash payments if the parent is early or late and may not have the exact amount of cash based on the agreed-upon rate discussed earlier in the night.
Parents can put in the exact amount and also add a tip. “Parents pay what they want to pay and sitters are paid what they’re owed,” she says.
SitterPals.com, which does its marketing through Facebook and Twitter, eventually will add blogs that target moms and families. It also will promote the payments option through those channels, says Armstrong.
Targeting these types of cash-only merchants is the benefit that Square brings to the payments market, one analyst says.
“This is exactly where Square is positioned, and they’ve made no bones about the fact that this is where they want to be,” says Todd Ablowitz, president of payment consulting firm Double Diamond Group. “Square is starting to ‘electronify’ payments that have always been cash or check.” Square says it has shipped more than 500,000 card readers to retailers across the country.
In terms of cost, the rate is relatively low, and Square’s service is easy to understand, Ablowitz says.
In February, Square changed its service fee from a 15-cent per-transaction fee to 2.75% of the sale (
Ablowitz also lauds that folks who want to accept credit cards for payment do not need a merchant account, only their own bank account to receive the payments. “Square took a page out of the PayPal book and brought it to the face-to-face payment market,” he says.
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