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Salvation Army Trials Mobile Payments With Square

11/18/2011 09:41 AM ET

Salvation Army Trials Mobile Payments With Square - Salvation Army mobile payments soon. The holiday sounds of coins clinking into red kettles may disappear, replaced by a quiet credit card swipe. The Organization has begun shifting into digital donations, as fewer and fewer shoppers carry much change or bills.

This year, the charity is testing the use of Square, a mobile payments startup that allows anyone to accept credit card payments via mobile devices.

“A lot of people just don’t carry cash any more,” said Maj. George Hood, The Salvation Army’s spokesman. “We’re basically trying to make sure we’re keeping up with our donors and embrace the new technologies they’re embracing.”

The Salvation Army, with nearly $2 billion in annual revenue, was the biggest and most visible charity to adopt the technology. Other nonprofit groups and individual fundraisers have used it too. A Girl Scout troop in Silicon Valley, for instance, used it earlier this year to sell some 400 boxes of cookies at Facebook’s headquarters after the father of one troop member who worked there realized that many of his colleagues did not carry cash, according to Advertising Age.

Lucy Bernholz, an expert on the use of technology by nonprofits, said this could have enormous potential. “It’s a no-brainer,” Bernholz said. “It’s frictionless and will make it so easy to give that if the person ringing the bell can get your attention, there’s no excuse any more because chances are you’ve got a credit card in your pocket.”

Jack Dorsey, Square’s co-founder and chief executive, who also co-founded Twitter, is confident that Square is simpler than other methods of digital fundraising because all it requires of a donor is to swipe a card and sign.

“Instead of training people on an entirely new behavior, an entirely new way to pay, we just use what they know,” Dorsey said.

Square, which charges a 2.75 percent fee on every transaction, a majority of which goes to the credit card companies, uses the same security measures as financial institutions and, the company said, has an added level of safety because the payer must be present to make the payment.

Dorsey said that marrying a cutting-edge technology with an institution established in 1852 was fitting. “It definitely is a throwback, but that age was an age of curiosity and innovation and particularly craftsmanship,” he said, “and as we build the product, we’re thinking about craftsmanship and details and experience.”

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