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Navy Federal's Jim Salmon says small business members "love simplicity" but dislike long-term contracts. "And Square fit that bill."
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Navy Federal Promotes Square For Small Business Payments

MAR 25, 2014 4:29pm ET
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VIENNA, Va. Mobile payments provider Square could get a big boost from the nation's biggest credit union.

Navy FCU is promoting Square's mobile card reader and payment processing services to its small-business members.

The $56 billion credit union's website now hosts a page that allows members to sign up for Square.

By partnering with Square, Navy Federal is providing members with an easier way to accept credit card purchases and track their sales, according to Jim Salmon, vice president of business services at Navy Federal.

Salmon told Credit Union Journal that the move came in large part from listening to members especially the 57,000 small business ones.

"Our core market and our core membership base, I should say, are these microbusinesses that make less than $1 million in revenue per year," Salmon said. "They love simplicity, they dislike long-term contracts because they're just not sure, and they're very mobile, very tech savvy. And Square fit that bill."

For members whose business needs are more complex, Navy Fed also offers payments processing through TSYS.

Salmon said that while some businesses needs may eventually evolve toward TSYS, he noted that Square is also evolving and developing into a more robust, traditional payments solution for merchants that need it.

Some Starbucks locations, he noted, have signed on with Square, along with a number of restaurants.

Navy Federal decided to work with Square not out of any desire to be a trail blazer, according to Salmon, but because it fit the bill for what members were looking for specifically simplicity, mobility and lack of any contract.

He added that the CU does not have any specific growth estimates for its small business portfolio as it relates to Square. "I'm concerned about member satisfaction."

Salmon declined to reveal how much revenue the credit union hopes generate through Square-processed transactions, but noted that the primary objective is to grow the small business deposit base, which currently stands at 57,000 business members and over $390 million in deposits.

"Square and even TYSYS and what's going on right now in the merchants space with the electronification of payments, it all fits into the mobility focus that a lot of members and businesses are going to," said Salmon.

-David Heun contributed to this article.

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