Square Cash • Hacker News Board

Re: Square Cash

#11

Post by ketralnis » Wed, Oct 16, 2013, 1:17 AM UTC

sami36 wrote: post #4

Free. I bite, What's the catch ? I presume recruit users to use the Wallet app ?

This is similar to competing services on venmo and paypal. I believe they make money on:

1. The "float". The interest that they make from the period that people have cash in their accounts. If an ACH takes 4 days to complete, they may take 5 days to complete it, and collect a day's worth of interest

2. The halo effect. Now you're a Paypal/venmo/square user, and therefore more accessible to vendors using them as a payment processor. Those vendors pay the service transaction fees.

Re: Square Cash

#12

Post by sbirch » Wed, Oct 16, 2013, 1:17 AM UTC

dangoor wrote: post #5

It sounds great, but I'm always left wondering what the angle is for free services. Will they make their money off of float? Is it something to do with the way debit cards are charged?

I think linking accounts to debit cards is pretty valuable on it's own. It opens the door to making payments for a lot of people much easier down the road.

Re: Square Cash

#13

Post by MBCook » Wed, Oct 16, 2013, 1:19 AM UTC

Note that it takes 1-2 days for the deposit. They must be using ACH to do this. The 'free' part is great. Even with Square, I'd be hesitant to enter my debit card number.

Planet Money recently did a great episode all about the US's ACH system and why it works the way it does.

http://www.npr.org/blogs/money/2013/10/04/229224964/episode-...

Re: Square Cash

#14

Post by pradn » Wed, Oct 16, 2013, 1:20 AM UTC

Echoing the other commenters: this is really great, but I'm a little weirded out because it's free. I'd like for them to be upfront about why it's free, since all the alternatives aren't.

Re: Square Cash

#15

Post by nly » Wed, Oct 16, 2013, 1:20 AM UTC

And composing an email to send someone money is secure how?

What stops someone from spoofing my email address, CC'ing it to cash@square.com, and clearing me out? And if someone does get in to my email account I'm toast?

Re: Square Cash

#16

Post by sahaskatta » Wed, Oct 16, 2013, 1:22 AM UTC

Hmm neat, however what benefits do I get using this when it's also built into Gmail and provided directly by Google Wallet?

http://www.google.com/wallet/send-money/

Re: Square Cash

#17

Post by [deleted] » Wed, Oct 16, 2013, 1:22 AM UTC

[deleted]

Re: Square Cash

#18

Post by toomuchtodo » Wed, Oct 16, 2013, 1:22 AM UTC

sbirch wrote: post #12

dangoor wrote: post #5

It sounds great, but I'm always left wondering what the angle is for free services. Will they make their money off of float? Is it something to do with the way debit cards are charged?

I think linking accounts to debit cards is pretty valuable on it's own. It opens the door to making payments for a lot of people much easier down the road.

Like how Paypal encourages you to tie your bank account to your Paypal account; they get to charge merchants the credit card interchange rate while taking advantage of the low ACH funding risk on the buyer/purchaser side.

Re: Square Cash

#19

Post by goeric » Wed, Oct 16, 2013, 1:23 AM UTC

Glad they changed it from 50 cents to free. Smart move.

They solve this problem with the least amount of friction.

Re: Square Cash

#20

Post by toomuchtodo » Wed, Oct 16, 2013, 1:23 AM UTC

kgermino wrote: post #6

>Free. Actually Free. Ok now I'm confused. I realize it's probably a marketing ploy, but how could the fees on this not eat them alive?

ACH transfers are stupid cheap compared to credit card transactions.