The Square Card Case -- a mobile loyalty card holder -- turns the Square application into a complete mobile payment solution, CEO and co-founder Jack Dorsey explained during a press event at the startup's San Francisco headquarters.
Each individual card in the case gives the carrier access to a venue's entire menu, which is updated in real time, and highlights the most popular products in the store, based on sales. The customer can tap to use or view his "tab," with the tab containing a digital record of all his past transactions at the venue.
The new payment system boils down to a modern day mobile version of telling the cashier, "Put it on my tab." The user can locate a participating venue via the application's "Explore Places" directory and then use just his name to checkout, no wallet required. The receipt is attached to the user's loyalty card for that particular location.
Businesses using the Square Register, the startup's updated payment software for iPad, will have the user on file and can select him from the point-of-sale screen to charge the transaction to the user's "tab."
Fifty merchants in Los Angeles, New York, San Francisco, St. Louis and Washington, D.C., will begin accepting the new payment option.
Square, says Dorsey, is the only company in the world to link customers to places and transactions in this fashion. He sees the Square Card Case as a complete mobile payments solution that bests those (think Starbucks Card Mobile) already in existence.
The press event kicked off with Dorsey explaining the history of Square -- it was started with the realization that everyone pays with credit cards -- and sharing a few examples of how its card reader is proving to be disruptive.
Dorsey says Square has shipped out more than 500,000 card readers, is seeing $1 million in purchases per month and is processing $1 billion in gross payment volume annualized.
Dorsey has been hinting at today's news, tweeting a few clues in anticipation of the press event.
Square, reportedly valued at more than $240 million after its $27.5 million round of financing, continues to process record transaction amounts. In late April, the startup processed more than $2 million in transactions on a Friday -- then its highest single-day transaction figure. This past Saturday, however, Square set a new record: $3 million processed in a single day.