If PayPal Inc. strikes with a new payment application, it stands to reason Square Inc. would respond with a new twist on its mobile-payment service.

At least it looks that way, with San Francisco-based Square on March 26 revealing Pay With Square as the new name for its Card Case mobile-payment application, which also comes with new “consumer-friendly” features.

Square launched the Card Case mobile wallet application last May, immediately sparking speculation that the company was on to something that could compete with the PayPal’s of the world (see story).

The company provided an upgrade to Card Case late last year, touting a new hands-free, voice-controlled aspect to its geo-fencing proximity payment feature (see story).

The Card Case software allowed Square to provide mobile-shopping aids for consumers, complementing the company’s strategy of providing small merchants with the Square card-reader attachment usable to accept payments on Apple Inc. iPhones and iPads and Google Inc. Android devices.

In renaming the Card Case application to Pay With Square, the company now lists participating merchants at the forefront of the free application instead of on the cards in the application’s virtual wallet. In addition, Pay With Square provides a list of featured merchants, a new search bar, and a mapping option in which the user tilts the phone to retrieve a merchant-locator map, according to the Square website.

When searching for a merchant site, the consumer can use Pay With Square to invite a friend to meet at a certain merchant location by sending a text message to that friend with the merchant map attached. The application still allows the consumer to pay at the merchant location just by stating his name, which in turn allows the merchant to find the consumer’s name in its payment system and initiate the transaction, Square says.

Square’s application name change and enhancement come on the heels of PayPal revealing its new PayPalHere application March 15 that allows merchants to accept any payment through a PayPal account (see story).

A Square spokesperson tells PaymentsSource the company believes the enhanced Pay With Square application “offers a more complete Square experience for both merchants and customers.” She did not address the rebranding timing as it relates to the recent activities of other wallet providers, including PayPal or Intuit Inc., which recently expanded its GoPayment card reader and mobile pay software into Canada (see story).

Meantime, PayPal claims its new mobile system covers all bases, enabling consumers to make and merchants to accept payments electronically through readers and camera phones.

When PayPal added a triangle-shaped mag-stripe card reader for payment acceptance on mobile devices, the comparisons quickly were drawn to the Square reader.

Square’s new application continues the drive among smaller alternative payments companies to change the mobile-payment landscape, a trend analysts have documented the past two years (see story).

It boils down to intense competition between PayPal, Intuit, Square and others for consumer and micromerchant interaction and payments, Gil Luria, analyst with Los Angeles-based Wedbush Securities, tells PaymentsSource.

Square always has focused on investing in and building technology around the micromerchant, Luria says. “The application upgrade may represent only a slight improvement over the previous application, but this is about rebranding and providing a tighter integration with the technology for the consumer and the merchant,” he adds.

Square already provides “a very good product that has been ahead of the curve,” and it should continue to be successful with consumers and micromerchants, Luria suggests.

Square makes good use of the geo-fencing proximity technology, which allows merchants to communicate with the consumer’s mobile phone and virtual wallet after one previous sale establishes a relationship, Luria says.

“That is a very innovative technology, and even though PayPal will be replicating (the Apple technology), Square has really made its product more compelling with it,” Luria contends.

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