November 18, 2013

JUSP, a European mobile point of sale provider, announced a new pricing model to entice larger retail merchants to its point of sale solution.

Mobile point of sale solutions have gained some ground among micro-merchants in several geographies around the globe, including here in the U.S. with the recent growth of Square. The common pricing scheme for many mobile point of sale solutions, which is based on a commission per transaction, suits the micro-merchant segment, but is not cost-effective for larger merchants, Stefano Calderano, JUSP’s CEO, argues.

“For many micro-merchants the traditional commission-based fee is affordable, but it doesn’t make sense for many larger merchants because they often are already paying less for processing [than they would with commission],” Calderano explains.

Square and other mobile point of sale providers typically charge 2.5% per transaction or more, where as the average U.S. retailer pays about 2% per card-present transactions and 2.3-2.5% for card-not-present transactions, according to CardFellow, an online marketplace for merchants to find and purchase processing services.

JUSP, which operates in Europe and is expanding to Asia and South America, is switching to a monthly fee model that Calderano says will be cheaper for larger merchants. The startup will begin offering its EMV mobile card reader for 39-69 euros per month. The pricing will vary within that range each month according to the volume of the merchant’s sales, according to Calderano.

The pricing model will be more beneficial for mid-size merchants, Calderano notes. The average mid-size merchant in European does around 35,000 euros per year in card transactions, but a commission fee usually doesn’t make sense for a merchant doing over 20,000 euros in card transactions per year, he adds.

Square released its own monthly fee rate (of $275 per month) last year after its headline-grabbing deal with Starbucks. But the company has announced that it will discontinue that offering next February. While the mobile point of sale space has grown more competitive in the last couple of years, no provider in the U.S. has yet come up with a pricing model to attract larger retailers like JUSP’s.

[See Related: Square Offers New Monthly Price Rate Following Starbucks Deal]

Jonathan Camhi is a graduate of the City University of New York's Graduate School of Journalism, where he focused on international reporting and interned at the Hindustan Times in Delhi, ...