iZettle is an European startup specialising in providing small businesses an ability to use their smartphone as a conduit for allowing payments using a proprietary iZettle card reader. It's a concept aimed at providing small business and merchants the ability to charge customers without resorting to expensive solutions. This is similar to Square in US, only it's a bit more secure as it uses a chip solution rather than magnetic strip and is EMV approved. Yesterday, iZettle, alongside their partners at Mastercard, American Express and EE, announced their entry to the UK market.
According to iZettle, 50% of missed sales by merchants are due to their inability to accept plastic. This is true even in build-up areas in London - I can hardly remember how many restaurants and coffee shops I had to give a miss because there was a 'only cash' sign. There are a million card payment in the UK, but 12-15 million iOS devices plus a heck lot more Android smartphones, so this service will allow plastic payments for small businesses who would normally be unable to afford more expensive specialised solutions.
In terms of security, the iZettle is, on theory at least, more secure than Square as the reader is chip-based rather than magnetic. On the other hand, the iZettle solution isn't chip and pin enabled, which is technically a more secure method of making payment than chip and signature. Still, according to iZettle, apart from the UK and France, their core European market is more comfortable with chip and signature, and I know my father personally prefer chip and signature payments.
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| An Android iZettle terminal |
At the iZettle launch in London yesterday, we were demonstrated by actual merchants who has been using the device for the past few months. Using it couldn't be any simpler, the merchant selects the items you have purchased, insert the card payment and after the app makes a secure wireless connection with the bank, remove the card and the customer is asked sign the screen. An email receipt (complete with geo tagging) will then be sent to the customer. In all it took about a minute from insertion of the card to confirmation message.
