The Mobile Payments Revolution Is Here
NEW YORK ( TheStreet) -- Square is leading the mobile payments revolution from its headquarters in San Francisco, and COO Keith Rabois believes the company can do more to make the shopping experience better for both consumers and sellers.
Speaking in a phone interview with TheStreet last week, Rabois noted that Square wants to make commerce better for everyone. "The process is broken," he said, when discussing where Square is headed. "We've made a lot of progress in the past two years, and we we want to simplify commerce. We want it to be a better experience for the customer and the buyer."
Square is growing at a tremendous rate, as it helps revolutionize the mobile payments industry. One of its major initiatives is a deal announced with Starbucks (SBUX) last year, which has helped raise awareness of its technology.
The Seattle-based firm is now integrating Square in all of its 7,000 U.S.-based stores, and, thanks to Starbucks' heavy foot traffic, the mobile payments specialist has a much higher profile. "80% of Americans visit Starbucks, and, basically overnight, Square Wallet was available to America," said Rabois.
Rabois would not disclose whether the deal was done at a lower rate than Square's normal 2.75% charge rate, but noted that the two companies will do more in the future.
"Starbucks has an amazing brand," Rabois said, adding that the coffee giant is a pioneer in mobile payments already with its Starbucks app. He called Starbucks the most advanced, most successful, U.S. merchant, and with Square Wallet, Starbucks has its eye on the future.
The future is bright for mobile payments, according to Forrester Research , which predicts the market will grow 48% annually between now and 2017, reaching $90 billion by the end of 2017.
The growth of mobile payments is showing up everywhere. Visa (V) , for example, invested an undisclosed sum in Square in Feb. 2011, while eBay (EBAY) reported strong fourth-quarter results on Wednesday, thanks in large part to its PayPal division. PayPal mobile payments volume rose more than three-fold to $14 billion, and the company expects more than $20 billion in 2013, noting that active accounts rose 15% year-over-year.
Visa is ramping up its efforts in mobile payments, launching its V.me digital wallet service.
The relationship between Square and Visa has been beneficial for both companies, according to Rabois, with Square signing up more than 3 million Visa customers following the deal. "We're taking advantage of Visa's expertise in payments, and everything we're building is electronic," he said. Both companies seem to be benefiting from this relationship, with Visa's share price up more than 100% since the deal was announced. Rabois also noted that Visa has endorsed Square Wallet as "the wave of the future," so it's clear the deal is working out on both ends.