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Shopify Inc. is often thought of as a platform for smaller e-commerce merchants, but it offers processing services for some 65,000 physical-world sellers, as well, and on Thursday it unveiled a new EMV card reader that features a Bluetooth low-energy link to mobile devices and what the company says is a long battery life.
The Chip and Swipe Reader, which will start shipping in June, processes American Express, Discover, Mastercard, and Visa transactions on both iOS and Android devices. Because of its Bluetooth capability, the reader doesn’t require a tablet or phone with an audio jack, a connection that some device makers are phasing out. Apple Inc., for example, last year released its latest and most advanced phone, the iPhone 7, without a jack. “We’re future-proofing,” David Seal, Shopify’s product manager for retail hardware, tells Digital Transactions News.
Ottawa-based Shopify claims the device, which sits in a charging base when not in use, can last a week, or through 400 chip or 700 mag-stripe transactions, on a single charge. It also supports Quick Chip, the Visa solution that speeds up notoriously pokey EMV transactions by bypassing certain authentication routines that aren’t necessary in the U.S. market.
The reader is free for new merchants and those not using Shopify’s older mag-stripe reader, which it introduced near the end of 2013. Otherwise, the Chip and Swipe reader costs $29. “We’re trying to democratize offline selling,” says Seal. “We want to make it extremely easy for our merchants to switch to chip.” More than 65% of all cards used to make transactions flowing through Shopify’s servers are chip cards, he adds.
The new device also represents a sharpened POS focus at Shopify, Seal says. “We’ve made a decision to take hardware much more seriously,” he says. “We’re targeting independent sellers, small business owners opening their first retail store.”
Unlike the older reader, which was developed for Shopify by Boston-based Roam Data, and another device launched in 2015 that processes EMV and contactless transactions, the new EMV reader was crafted in-house and is based on feedback from merchants, Shopify says. Roam Data is part of terminal maker Ingenico Group.
Shopify’s new EMV card reader will face growing competition. Other companies have identified the opportunity for portable EMV readers, and some have also taken steps to prepare for the disappearance of the audio jack.
New York City-based CardFlight Inc., for example, in September launched a pair of devices that can handle both EMV and transactions using near-field communication, a contactless protocol. Both readers use Bluetooth to link to smart phones or tablets. Listing at $79 and $149, the two devices carry a significantly higher price tag than the new Shopify reader, but CardFlight says volume discounts can bring the cost down. Square Inc., meanwhile, has offered a $29 EMV-capable device since late 2014.
Overall, publicly held Shopify serves 375,000 merchants on its platform, and processed $5.5 billion in volume in the fourth quarter.
