Bought a travel wallet :(

Square has given up on making people purchase coffee with their faces. The company has shuttered its Square Wallet application, which encouraged users to check-in to a business and pay for items by saying their name at checkout. The app will be replaced by Square Order, which allows users to place orders from nearby restaurants to avoid waiting in line or swiping a credit card. (It’s also decidedly less face-based than Wallet).

The switch seems to be an admission that payments haven’t changed as much as Square may have expected. The company thought it could make it easy for people to pay without having to reach into their pockets — whether for a credit card or a smartphone — but it was wrong. People are still paying with credit cards, still placing orders from their smartphones, and still wary about paying for something with naught but their faces. (Even Farhad Manjoo, who thought Square Wallet might put an end to the credit card, thought that face-based payments were creepy.)

Square Order might be able to bypass those issues by providing obvious utility (allowing users to skip ahead in line) without requiring them to fumble with barcode scanners like many other mobile wallets. Conceivably, Square Order could solve most of the problems that people have with mobile payments solutions. It just has to get over the legacy left by Square Wallet and add enough restaurants to make it worth installing in the first place.

UPDATE: A Square spokesperson sent Pando the following statement via email after this story was published:

Today we launched Square Order, our app that gives buyers an easy way to order for pickup or dine in from local shops, cafes, and restaurants. We’re focused on building the best experience for buyers. We think the buyer experience extends beyond the payment and centers on ease of use and convenience. With the new app, Square helps customers frequent great neighborhood businesses in a new, fun way that becomes part of their daily routine.

Square Wallet gave buyers a magical way to pay. We’re taking everything we learned from Wallet and what people love in Wallet and building it into Square Order. We think it’s an even better experience that offers buyers more utility. We continue to support our Wallet customers and want to encourage new customers to try Square Order.

Square Wallet remains unavailable in the Google Play Store, the App Store, or Square’s website, however. So existing users can continue using the app, but new users will be downloading Square Order instead. Wallet isn’t dead so much as it’s on life support, at least for the time being.

Reactions from around the Web

The Next Web explains how Square’s experience with other products could help Square Order:

While plenty of ordering ahead services exist in the US market, PayPal has added the feature to its iOS app, Square has a big advantage in that it already supplies payment systems for merchants. That could allow it can onboard large numbers of retailers and their inventories into the new service quickly. Since it also handles the payment side of things, it isn’t reliant on a third party, which helps users avoid paying extra fees and help Square bank more money.

Re/code reports on the ease with which Square decided to kill Square Wallet:

The decision to move away from Wallet is a big moment for Square, though not an unexpected one. The app hasn’t ranked in the Top 200 free Finance apps in Apple’s Appstore for some time and the company never got the help pushing it from Starbucks like they hoped, according to people familiar with the deal. Varma said it only took two meetings to come to the decision to kill off Wallet.

Now, Square is betting that Order will find more success. And it better; it seems unlikely that Square will get many more chances at creating a hit consumer product.

Wired asks how Square might use its massive data trove to help consumers and businesses:

For example, take the data on what the average price of a turkey sandwich is in a given neighborhood. That can be used in all sorts of ways. As a consumer, you may want to use it to decide whether or not you want to eat here, or go on to the next subway stop. A business could use it to help it adjust pricing to be in line with its competitors, without having to physically visit all the surrounding shops—or even to zero in on the best city block for its new location. Cities could use even use it to help foster small business growth in underserved areas.

The New York Times describes the problems with many mobile wallets:

When I complain to friends and colleagues about the inconvenience of fumbling around for my wallet when I’m shopping — and say I wish I could just use my phone instead — they often give me bewildered looks.

Apparently, that’s because paying with a phone today is rarely easier than paying with a credit card. Paying via phone often involves a series of awkward swipes and taps to start the transaction, and the process can be disrupted by spotty wireless connections, low batteries or other electronic hiccups.

Pando weighs in

On the credit card’s place in the future of payments:

Over the years many pundits (including me!) have speculated how Apple, Amazon, Facebook and other giants could destroy the credit card industry simply by pushing their users to tie their payment systems to bank accounts instead of cards. But what many of these pundits don’t realize is that setting up a secure payment system is a huge, expensive headache. Does Apple really want to deal with chargebacks, purchase monitoring, fraud, and theft? I doubt it. And what would be the point?

For most customers, there’s already a perfect way to pay. Why fix it?

On the problematic Square-Starbucks partnership:

Customers probably won’t deal with a buggy, nigh-unusable system if they can just swipe a card or toss a bill instead. Why should they? Paying with Square is supposed to be more convenient than the alternative, but if it causes as many problems as it solves, customers will avoid it and stick with tried-and-true payment methods.

Instead of getting Square in front of the many coffee-addicted Starbucks customers and raising awareness for a nascent platform Starbucks has shown exactly how ill-prepared big companies are for the payments platform. Seriously — if one company can mess up the scanning of a barcode so badly, it wouldn’t be the least bit surprising if other companies did the same thing.

[Photo by mroach]