Every now and then, entrepreneurs surprise the world with their innovations which are hardly transformational - they are disruptive. Square is an example of one such disruptive innovations in recent times. For small retailers, especially those that are mobile, taking credit cards can be expensive and cumbersome. Square has come up with a solution for retailers to accept payments via customer’s iphone. It comes with a free magstripe reader that connects to the iphone and works on iphone application that authorizes credit card, captures customer’s signature and emails the receipt. 

Why is this interesting? Besides technology, it is disruptive in how it could change retail payments industry. For anyone, who has run a small store or a business would empathize how difficult and costly it could be for small business to accept cards. 

Square is different. Retailers need no merchant account, no contracts, no monthly minimums, no set up fees, no monthly fees - meaning thousands of dollars in savings in each month and hassle-free service for small retailer. It comes with free card reader and a relatively low fee of 2.75% + 15c on card swipe transactions. That rate could save millions for mid-to-large retailers too. All in all, this service could give large banks and payment gateways run for their money as they cannot go on charging high fees/ squeezing out margins from small retailers.

Now that is a disruptive innovation.