Square Payment API App Fee Product Disclosure Statement
Issued by Square AU Pty Ltd
Australian Financial Services Licence No. 513929
ABN 38 167 106 176
Effective: 14 August 2019
- Things you should know
- How the PAAF service works
- Significant benefits of using the PAAF service
- Significant risks of using the PAAF service
- Fees and other costs
- Your tax liability
- If you have a complaint
1. Things you should know
This Product Disclosure Statement (PDS) is designed to assist the Developer or Seller (also referred to as “you” or “your”) in deciding whether to use the Payment API’s Application Fee (PAAF) service.
Your contract with Square AU Pty Ltd (“us” or “we”) for the PAAF service is comprised of:
This PDS document; and
Square AU’s General Terms of Service and Payment Terms (“Terms and Conditions”) which were disclosed to you, and agreed by you, as part of opening an account with us.
You may request a copy of the Terms and Conditions free of charge by contacting us using the details below. Your contract with us contains important information regarding the use of the PAAF service. Please consider this PDS carefully before using the PAAF service.
The information set out in this PDS is general in nature. It has been prepared without taking into account your objectives, financial situation or needs. You should decide whether this service is right for you. We do not provide any financial advice or recommendations by providing this PDS to you.
Changes to this PDS
The information in this PDS is correct and current as at the date stated above.
We may need to update the information in this PDS from time to time. If we consider (acting reasonably) that the update is not materially adverse to you, we will make the update available on our website. Alternatively, you may request a paper copy of any updated information free of charge by contacting us using the details below. However, if we consider (acting reasonably) the update to be materially adverse to you it will be included in a replacement or supplementary PDS.
Obtaining other information
If we make other information relating to the PAAF service available to you or prospective users, this information will be made available on our website https://squareup.com/au/en.
Our contact details
Square AU Pty Ltd (AFSL number 513929) is the issuer of the PAAF service and can be contacted via:
- Mail: GPO Box 1640, Melbourne VIC 3001
- Email: Visit Square Support
- Phone: 1800 760 137
- Website: https://squareup.com/au/en
2. How the PAAF service works
To use the PAAF service, both the Developer and Seller must first register for a Square account (if they do not have an existing Square account).
Using Square’s APIs, including the Payment API, the Developer can create an application integrated with us for payment processing to enable a Seller to accept payment for the sale of goods or services using (or on) the Developer’s application or website.
The PAAF service enables a Developer to receive a portion of the proceeds of a purchase made by a buyer from the Seller using (or on) the Developer’s application or website. The portion of proceeds is mutually agreed by Seller and the Developer in a separate agreement between the Seller and the Developer (to which we are not a party).
The following steps outline how the PAAF service works:
1 A Seller signs up on the Developer’s website or application to accept payments for the sale of its goods and services. The Seller grants to the Developer permission to process payments and to split the proceeds of each transaction with the Developer by agreeing to “Allow payments with additional recipients” on the permissions screen presented to it by the Developer.
2 Buyer purchases Seller’s products or services using the Developer’s website or application.
3 Developer uses the permissions granted by the Seller to ask Square’s systems to process the payment.
4, 5, 6, 7 Square’s systems (through our acquiring bank) clear and settle the transaction through the card network system.
8 We inform both the Seller and Developer through the Square API that the transaction has been successfully completed.
9, 10 Funds are settled to us by our acquiring bank.
11 We transfer funds, net of the fee charged by us, to (1) Developer’s bank account and (2) Seller’s bank account, according to the allocation agreed to by the Developer and Seller and communicated to us by the Developer. For example, if the allocation to the Developer is 20%, let’s consider a purchase from the Developer’s website or application for $100. Square takes its fee of 2.2%. The balance of $97.80 is split between the Developer as to 20% ($19.56) and the Seller as to 80% ($78.24).
3. Significant benefits of using the PAAF service
The significant benefits of the PAAF service, are as follows:
- We charge no set up fees for use of the PAAF service.
- We charge no maintenance fees for use of the PAAF service.
- Allows a Developer to be paid for the Developer’s application or website on a per transaction basis.
- Allows a Developer to split the proceeds of a purchase transaction between the Developer and the Seller. The split is agreed to by the Seller and Developer separately. We are not involved in the making of that agreement.
- It allows a Developer to determine how refunds are split for certain purchase transactions. The split is agreed to by the Seller and Developer separately with no involvement from us.
- Allows Seller to easily pay the Developer for utilizing the Developer’s application or website, by means of the splitting of the proceeds.
4. Significant risks of using the PAAF service
The significant risks that may be associated with using the PAAF are outlined in this section. There may be other risks that relate to the use of your PAAF service which are not listed here. The risks described below are intended to be a summary of the major risks associated with the PAAF service and are not an exhaustive list.
Once a Seller grants the permission to the Developer, Developer is authorized to process sale and purchase transactions and to give directions for the split of the proceeds of the payment transaction and any refunds. Therefore, the Seller must consider and agree to the Developer’s terms on how the proceeds of payment transactions will be split before it grants any permissions to the Developer.
Developer may change the split of the proceeds of the payment transaction in breach of its agreement with the Seller. Seller must review its transactions history in its Square account on a regular basis to review if the split is in compliance with the terms agreed to by the Developer and the Seller.
Risk for both Developer and Seller
Square accounts are subject to risks and limitations outlined under the General Terms of Service and Payment Terms. Those limitations and risks will also apply to the PAAF service by virtue of each of the Seller and the Developer being a Square account holder. For example: if we become insolvent, there is a risk that Seller and Developer will not get paid; unavailability of our payment processing services; unauthorised transactions/risk of chargebacks; security breaches, closure of your account for breach of the terms and conditions. These risks are not specific to the PAAF service so we have not detailed these here.
5. Fees and other costs
We do not charge the Seller or Developer for using the PAAF service. Separately, our payment processing fees would apply to all payments processed in accordance with Square’s Payment Terms.
The Developer uses the PAAF service to split payments received for purchase transactions processed through the Developer’s website or application. This means that Developers may use the PAAF service to charge a fee (which may vary depending on the nature of the transaction) as agreed to between the Seller and Developer. We have no involvement in the setting of this fee. The Seller must speak to the Developer to understand the details of the fees.
6. Your tax liability
You are responsible for collecting, reporting and paying any taxes that may arise from your use of the PAAF service. You agree to comply with applicable tax laws in connection with your use of the PAAF service.
If you are a Seller, we will provide a tax invoice to you if you have processed any card payments. If you received such payments in a calendar month, we will provide you with a tax invoice indicating the amount of GST we have charged on our processing fees.
Please note that Square reports payments processed, as required, to the ATO (Australian Tax Office).
7. If you have a complaint
We are committed to ensuring customer complaints are dealt with promptly, fairly and consistently in accordance with our Dispute Resolution Policy and relevant regulatory standards.
If you are a Seller and you have a complaint about a Developer’s services, we urge you to reach out to the Developer’s customer support in the first instance.
Internal dispute resolution
If you have a complaint about our services, please contact us and we will try to resolve it promptly:
- Email: [email protected]
- Phone: 1800 760 137
- Mail: GPO Box 1640, Melbourne VIC 3001
We aim to resolve your complaints as soon as possible and no later than within 45 days.
Where we cannot resolve a complaint within 45 days, we will give you the reason for the delay as well as an indication of when we can expect to resolve the complaint. We will also let you know that you can contact the Australian Financial Complaints Authority (AFCA) with your complaint and provide you with AFCA’s contact details.
External dispute resolution
If you are not satisfied with our resolution or handling of your complaint you may wish to contact AFCA. AFCA offers a free independent external dispute resolution services for consumer and small business complaints.
You can contact AFCA on:
Email: [email protected]
Phone: 1800 931 678 (free call)
Mail: Australian Financial Complaints Authority, GPO Box 3, Melbourne VIC 3001