Square hits Starbucks in early-November; Save your tips until Summer 2013

Oct 5, 2012
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Starbucks will kick off its Square payments system in early November, with the system expanding to support digital tipping for your favorite barista in summer 2013. The news follows the addition of Starbucks loyalty card to Apple's Passbook in iOS 6, and will see around 7,000 US locations taking the Square Wallet payments from next month.

Square and Starbucks announced their deal to use the mobile payments upstart back in August. At the same time, Starbucks cut out its existing credit and debit card processing partner, replacing them with Square's backend, and invested $25m in the firm.

As the mobile app provision increases, Square and Starbucks will make buying a cup of coffee even more straightforward. Passbook will automatically flag up the Starbucks Card on the iOS device's lock screen when they enter a store, and they'll be able to pay by "swiping" their phone.

The agreement was lauded as reducing Starbucks' processing costs as well as increasing Square's footprint as a payments service provider and making it more likely that users would take the time to install the mobile app. However, the addition of tip support - although tardy after payments in general have been accepted - will offset any shortfall in tipping to store staff themselves, who might suffer from a reduction in cash payments for smaller amounts.


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