Your iPhone Can Now Swipe Credit Cards

Here's the crazy-cool innovation of the day. Jack Dorsey, the creator of Twitter, has invented a new device to turn iPhones into a credit card payment system. And this isn't merely an application that lets you type in a credit card number: this consists of an attachment that allows you to actually swipe credit cards to obtain payment. There's some impressive creativity at work here.

Here's the detail of how his "Square" device/app works, via PCWorld:

Square is a little plastic magnetic card reader that hooks into the headphone jack of your iPhone or iPod Touch. When you swipe a credit card through the device, it converts the card information into an audio signal, which is then processed by Square's software application on the device, according to GigaOm. Then, the card information is encrypted and transmitted to Square's servers via a Wi-Fi or 3G connection for processing. Dorsey says your credit card information is never stored on Square-enabled devices.

Once the transaction is approved, you sign for the purchase on the iPhone screen using your finger. Your receipt can then be e-mailed to you or sent via SMS. But it's not actually a receipt. What you get instead is a link to a private page on Square's Website where you can view and save your receipt, according to TechCrunch.

And anyone can use Square, from boutiques to street vendors. The device attachment itself can fit on your keychain. You just need an iPhone, but the company is planning on expanding the device and software to work on other smartphones as well.

Here's a video of Square in action:

I just love technological innovation like this. With each incredible new mobile device application, it seems like the world is getting closer and closer to attaining the kind of gadgets we read about in science fiction. Now about those flying cars. . .