Apple vs Square Inc, Who Will Dominate the Digital Payments System?

Ever since Apple acquired a Canadian startup Mobeewave [1] for $100M in 2020, the company has reportedly been working on a new feature that will allow businesses to accept payments directly on the Apple device, without any additional hardware.
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Apple has amplified its push in payments in recent years; first by launching the Apple Card in 2019 and then rolling out Apple device installment plans on the credit card later the same year. 

The company also offers Apple Cash card for digital peer-to-peer (P2P) payments and is working on a service for Apple Pay that would let people buy things and pay them off later in installments, Bloomberg News reported in 2021.

So where does Square fit into the picture then?

In order to accept payments on an iPhone today, businesses need to use payment terminals that plug in or communicate with the phone via Bluetooth, such as Block Inc.’s Square. Square is the dominant player in the payment terminal space, boasting a 35% share of the point-of-sale systems market.

Square charges businesses 2.60% of the sales price plus 10 cents of any transaction they process via swipe, insert, or tap. For every manually keyed-in transaction, Square charges 3.5% plus 15 cents. Square point of sale (POS), is used in conjunction with Square Reader, a small device that can be installed on a smartphone or tablet that reads credit and debit cards. Square Stand, one of the company's other physical products, allows users turn an iPad into a complete POS system. 

Square has also expanded into financing small businesses, with products like Square Capital, which provides cash advances to merchants, without locking them into payback schedules. The firm also provides complete payroll services to small business in all 50 states, with Square Payroll.

Isn't Square moving in a new direction themselves?

Yes, Square is renaming itself Block and will be focusing on technologies such as blockchain and expands beyond its original credit card-reader business.

Jack Dorsey’s, the CEO, of Block, in an announcement that the new name, effective Dec. 10, “acknowledges the company’s growth” and “creates room for further growth.” Block will still trade under the ticker SQ on the New York Stock Exchange.
“We built the Square brand for our Seller business, which is where it belongs,” Dorsey, cofounder and CEO, said in a statement. “Block is a new name, but our purpose of economic empowerment remains the same. No matter how we grow or change, we will continue to build tools to help increase access to the economy.”
So what about Apple vs Square (or Block)?

As a market leader in digital payments systems, Square (now Block) will give Apple a run for its money. For small businesses to take payments directly on their device, without the need for an additional hardware is a viable proposition. What it will come down to are the percentage of revenue (%) charged by Apple as compared to Square. 

[1] Mobeewave is the developer of a technology that allows phones to process payments with the tap of a credit card. Samsung, which backed Mobeewave in 2019, began using the startup's payment-acceptance technology prior to Apple's acquisition of it.