Square Reader Review: A Great Product For Small Business

The Square Reader is a great solution for those who want a complete payment and point-of-sale bundle that has a simple pricing structure, is quick to set up, looks great, and can be taken on-the-go.

Card payment using Square reader
Square Reader credit card transaction
American Express
Apple Pay
Google Pay
Samsung Pay

Our take on Square Reader

The Square Reader is a great solution for those who want a complete payment and point-of-sale bundle that has a simple pricing structure, is quick to set up, looks great, and can be taken on-the-go.


  • Square Reader is a bargain at $64.90
  • Transparent pricing of 1.90% per transaction for all card types, no additional fees
  • Purchase from a store, sign up on the app, and start taking card payments immediately
  • Pair the Square Reader with your smart device and take payments on the go
  • Free POS available and quite feature-rich
  • Beautiful design that will turn heads


  • Transaction fees of 1.90% is quite expensive, expect to get under 1.50% from banks
  • Square Stand only fits iPads
  • Multi-currency / dynamic currency conversion not available
  • Least cost routing not available
  • Instant settlement not available, must wait one business day

What is the Square Reader?

The Square Reader is a small bluetooth tile that enables you to accept payments using their smartphone or tablet. You simply purchase the Square Reader from a retail store, pair it to your device, sign up through the Square app, and you can immediately accept card payments.

The Square Reader is a small and light device that is perfect for people that need to take payments on the go. The tile is approximately 6cm x 6cm x 1cm and weighs only 56g.

You can accept cards using tap & go or insert, and can accept debit and credit cards from eftpos, Visa, Mastercard and American Express.

You may notice that the device does not have a place for PIN entry. For transactions that require a PIN, the customer will need to enter their PIN on the smart device.

Square Reader Mobile Payment

Simply pair the Square Reader to your smart device to start accepting debit and credit cards instantly

Square Reader Pricing & Fees

Transaction Fees

One of the biggest selling points for the Square Reader is its transparent pricing structure. Square offers a fixed 1.9% transaction fee for all in-person card payments.

Transaction fees don’t differ based on the card type (e.g. eftpos vs Visa vs Mastercard vs AMEX) and customer type (e.g. domestic vs international). Square’s pricing structure offers clarity on your transaction costs, you’ll never be surprised with a huge bill.

However, we tend to set the bar of ‘cheap fees’ around 1.5%, so the Square Reader just misses the mark.

This is because major banks can offer fixed price plans with fees below that mark. For example, the Westpac Eftpos-1 85 Plan includes $6,000 worth of transactions for $85. This is equivalent to a transaction fee of 1.42% and this plan-based fee structure also gives you clarity on monthly transaction costs.

The other thing to consider is manual payments (e.g. those made through the Square online portal) are priced at 2.2%. This is to cover the additional risk involved with these type of transactions.

Other Costs

The only other cost that you’ll have to pay is the Square Reader purchase price, which is $64.90 including GST.

Unlike other providers, there are no establishment fees, no terminal rental fees, no monthly fees and no monthly contract. You only pay fees if you’re using the device and making money.

Payment Types

The Square Reader allows you to accept cards using tap and go or insert, and you can accept swipe transactions using the separate but included magstripe reader.

The magstripe reader is a separate device that requires a headphone jack. Although this might pose a challenge if your device no longer has a headphone jack, this shouldn’t be too much of a concern for Australian businesses, as all domestic cards are tap or insert enabled.

The Square Reader can accept debit and credit cards from eftpos, Visa, Mastercard and American Express. This includes mobile wallets like Apple Pay, Google Pay and Samsung Pay.

However, Square currently does not accept China UnionPay, Discover, JCB or digital wallets, such as WeChat Pay, Alipay, Zip or Afterpay. These are becoming more common, especially buy now pay later companies like Zip and Afterpay, so Square should really consider adding support for these payment types.

Square Point of Sale

Square provides free point of sale software to use with the Square Reader. The Square POS is a surprisingly fully-featured point of sale solution that can be accessed through any device.

We will conduct an in-depth review of the Square POS in another article but, at a high level, it includes the following features:

  • Inventory Management: Import products quickly using CSV, manage your stock levels, and receive alerts when stock levels are running low
  • Customer Loyalty: Identify returning customers and send digital receipts with customer feedback forms
  • Employee Management: Clock in and out, define secure permissions for different employees
  • Multi-Site Management: Manage multiple store locations from one dashboard
  • Reporting and Analytics: Figure out which products are most popular, know whether you should stay open later, and build custom reports.
  • Third-Party Integrations: Connect with hundreds of third-party apps, including account software, booking and scheduling software, marketing software, and more!
Square Point of Sale

Square provides a free point-of-sale with the Square Reader

Bank Account & Settlement


One of the biggest draws of the Square Reader is that you can sign up and start taking payments immediately. However, like all payment companies, Square needs to run checks to meet Know Your Customer and Anti-Money Laundering compliance requirements.

This means that you can take card payments immediately but it takes up to five days before you can send that money from your Square wallet to your bank account. After Square has verified you, then the funds will land in your bank account the next day.

Dedicated Bank Account

Unlike other eftpos machine providers, Square does not force you to settle your transactions into a particular bank’s account.

All transactions land in your Square digital wallet and these can be transferred into any bank account that you choose.

Servicing Experience

One benefit of the Square Reader that many people don’t realise is the servicing experience.

Businesses that rent traditional eftpos machines from banks and have a technical problem, must call the bank and wait for a servicing technician to replace their device. In the meantime, they can’t accept card payments.

However, the great thing about the Square Reader is that it’s inexpensive. You can keep a back-up device in the drawer. So if it ever breaks, you can throw it in the bin and pull out the spare device.

Additional Hardware

The Square Reader isn’t just a lightweight, portable card reader for taking payments on the go. You can also set it up as a counter-top point of sale.

Square offers a number of different hardware add-ons to improve how the Square Reader and POS look and feel at the counter. This includes:

  • Square Reader Dock: A small stand for the Square Reader that elevates it and faces it towards the customers when sitting on the counter. Includes a long, built-in cord for continuous charging. It costs $39 when purchased with a Square Reader.
  • Square Stand:  The Square Stand is designed to fit an iPad and swivels to allow both merchant facing functions (e.g. selecting products for purchase) and customer facing functions (e.g. entering PIN). It comes bundled with a Square Reader and Dock, and costs $299.
Square Reader Hardware

Additional hardware includes the Square Reader Dock (bottom) and the Square Stand (top)

Other Features


Multi-currency (also known as direct currency conversion) is the ability to show the cost of a purchase in a customer’s home currency on the eftpos machine.

The benefit of direct currency conversion for a business is that it reduces the likelihood that a customer disputes their transaction when they are surprised by the foreign exchange cost.

Unfortunately, although Square accepts foreign cards, it does not provide direct currency conversion.

Least-Cost Routing

Many years ago, when a customer paid for a transaction, the shopkeeper would ask ‘cheque, savings or credit?’ and press a button on the terminal. This was to choose which provider would process the transaction. Cheque and savings would go through the eftpos network, whereas credit would go through a scheme network (e.g. Visa or Mastercard).

The introduction of tap & go eliminated the need for the shopkeeper to press anything on the terminal. However, it also meant that transactions would typically go through the scheme network.

Why is this bad? Well, typically the scheme network is more expensive for the business and there was no way to avoid it.

But now with least-cost routing, business can opt to have all debit transactions processed through the least expensive network — be it eftpos, Visa or Mastercard.

Square does not offer least-cost routing. But it wouldn’t matter anyway, as all card transaction fees are set to 1.90%.