Well today he’s revealed this next big thing to world as Square. The idea – let people quickly and easily accept physical credit card payments from their mobile phone. A small device attaches to the phone via the headset/microphone jack. The device gets the power it needs to send data to the phone from the swipe of the card, and sends the information over the microphone connection.

Even before launch Square is now valued at $40 Million with already $10 Million in Venture Capital Backing. By the looks of it, Square is a bold entry into this huge market of physical payments. “What PayPal was to eBay, Square is to the real world,” said one person close to the company.

The Big credit card companies Visa, Mastercard and American Express are already on board with Square to take credit card payments. Square has already won the attention of the blogosphere, and we will have to wait and watch to see if Square becomes the next big thing.

Enough of the talk, lets have a look at what Square looks like…

I am already quite excited at the numerous possibilities once Square is launched to the general public. Imagine Street vendors being able to accept Credit Card payments without the usual hassle of get merchant accounts, and of course the curse of Paypal fees.

At the moment from the available information Square works on the iPhone platform and Verizon Droid. I am sure Jack and team are looking to extend to the high end Nokia’s and Blackberry devices as well.

If Square takes off, it’ll be a big boost to the credit card companies IMHO. Square is in my heart the next big thing in the world of ecommerce. Paypal sit up and take note. You have a new competitor in town….

More Info at Official Website | Twitter Account

If the security risks faced by credit card users weren’t already enough, now the security information that is stored in a magnetic strip behind the card can be hacked and be used for malicious purposes. Hacking the data on the magnetic strip so far has been unsuccessful but RFID security guru Adam Laurie has come up with a test program named CHaP.py, specifically designed to read the chip and PIN credit cards that comply with the EMV standard.

Here’s what Wikipedia has to say about the EMV Standard :

The EMV is a standard for interoperation of IC cards (“Chip cards”) and IC capable POS terminals and ATM’s, for authenticating credit and debit card payments. The name EMV comes from the initial letters of Europay, MasterCard and VISA, the three companies which originally cooperated to develop the standard. It defines the interaction at the physical, electrical, data and application levels between IC cards and IC card processing devices for financial transactions

The first demo of this program is in its early stages. Currently it only works with PC/SC card readers at  the moment, but it also includes support for the physical chip and RFID interfaces. Keeping all this geek talk aside, what all this means is that both Mastercard and Amex cards can be hacked using this program..

All the information available on the credit card’s magnetic strip can be stripped away (the owner’s name, the primary credit card account number included) and afterwards be used by a crafty hacker to create a clone of the original credit card. Imagine the great financial risk this could pose!

Adam intends to integrate CHaP.py into the RFIDIOt open source library for exploring RFID devices. The good news for us, is that this hack was discovered by the good guy and not the bad guy. So for the moment, all things are ok. But if the bad guys get hold onto this, then none of our bank accounts would be safe, and something really bad could happen.

Via eWeek