Groupon Rumored To Test Payment Service

Groupon Rumored To Test Payment Service

As bank transaction fees continue to rise, many small business owners have turned to PayPal or Square for their primary payment methods. Now, Groupon, the company known for its daily deals on restaurants, beauty salons and more, is reported to be testing a payment service that would make PayPal and Square look pricy.

According to Industry Analyst Rocky Agrawal, who wrote a guest post on, the new payment offering would charge merchants a 1.8 percent transaction fee and 15 cents per transaction charge for the payments processed through the system. This compares to PayPal Here and VeriFone Sail’s 2.7 percent of purchase fee on all credit and debit card swipes and Square’s 2.75 percent of purchase fee.


While Groupon’s service would supposedly charge 2.3 percent for purchases made with American Express cards, this is still less than PayPal and Square, which maintain the same fee for all cards, and Sail, which charges 3.7 percent for American Express transactions.

Accordingan article in the Los Angeles Times, one perk to Groupon’s payment service is that it would supply retailers with an Apple iPod Touch and case that secures a card swipe device to the back. As Agrawal points out, Square and other payment services only give the card readers for free, not the mobile devices. His VentureBeat post also refers to a tip that Groupon may offer a full-fledged point-of-sale system for the iPod and iPad.

Although the other payment systems use dongles (readers) that plug into the top of the mobile device, the Los Angeles Times references insiders that say Groupon opted for a more secure case that was less likely to break off.

In an email, Nicholas Halliwell, a Groupon manager for merchant public relations, says, “In regards to the payments service, we’re constantly testing new products and services designed to help small business owners acquire more customers and run their businesses more effectively, but we would have nothing to announce at this time.”

Halliwell goes on to discuss the company’s new rewards program, which helps foster repeat business and the loyal customer base that many businesses lose out on when buying into daily deals. Groupon now offers an online scheduler that allows businesses to book online appointments through the Groupon sales process. Other services available to merchants include a merchant center dashboard and the ability to limit locally-based, real-time deals while the deal is taking place.

For more information on these programs and more, visit