Online marketplace Etsy has begun offering a free credit card reader to its legion of independent sellers.
The move can be seen as a bid by Etsy to expand its footing beyond the Internet and into offline commerce, as the company says 35 percent of its sellers do a bulk of their business at in-person events such as craft fairs.
The Sell on Etsy reader comes in the form of dongle that plugs into the audio port on a phone or a tablet, much like similar devices from Square, Amazon and PayPal.
It works in conjunction with Etsy's Android and iOS app, and is only available to US-based Etsy sellers using Direct Checkout, Etsy’s own payments platform, to accept card purchases on Etsy.com and the Etsy app.
The card reader and Etsy app combo comes with some useful business management tools as well. For instance, all sales made in person are immediately reflected in a seller's Etsy shop and their online inventory is automatically updated with each sale. There's also digital receipts that are directly linked to the seller's Etsy shops, which Etsy says is designed to strengthen the buyer/seller relationship and build buyer loyalty.
Etsy will charge a 2.75 percent transaction fee for each payment made on the device, which is also comparable to other dongle-based counterparts. The traditional 3.75 percent Etsy transaction fee will not be applied to the offline payments.
While it's unlikely that the Etsy reader will pose any serious threat to Square or PayPal, it does give the brand an offline presence that will boost recognition and potentially bring in more sellers. What's more, the reader does not appear to be equipped to accept EMV chip-cards or mobile payments – both of which are on the cusp of either mandated or optional widespread consumer adoption.