HandyNYC owner Tommy McGhee has been using Square’s mobile credit card reader in his construction, renovation and design business for more than a year. He likes it so much that he dropped other services like PayPal. “I was using a variety of different mobile transaction apps,” McGhee explained in a phone interview. Square, which provides a small electronic device that can be attached to smartphones and tablets to read credit and debit cards, “is my go-to with regards to transactions now because to me, it’s just much simpler,” he said. “It’s cleaner.”
Despite praise from merchants like McGhee, however, Square stock has climbed less than 1% since going public in November. That’s better than the broader S&P 500 financials index but not as good as PayPal’s 2.1% gain, and it reflects the challenges facing the San Francisco-based payment processor in an industry that may be worth more than $2 trillion by 2020.