From my email inbox:

I’m assuming that Square was paying attention to Intuit and its new smartphone credit card processing service GoPayment, which is one of the reasons why Square has decided to drop their fees for its own no merchant accounted needed service down to just a flat 2.75% per total transaction fee (purely speculation). Now you will still have to pay 3.75% if you manually type in the credit card number, but for both transaction types, the “+15 cents” Square initially tacked on to every charge has been dropped.

Most of the buzz around this announcement by Square is that they will more than likely take a revenue hit by dropping the 15 cents charge, hopes to gain volume in order to further cement itself as the front runner in the relatively new mobile transaction processing arena as other big players (like Intuit, Visa, Bank of America, etc) start to make a move and offer similar services that rival what Square has been doing for a little over a year.

In my opinion, if a move like this from Square can get other players’ attention like Intuit, and thus creating even more competition (which is always good for the consumer), paying per transaction fees as a small business with low volume credit card transaction (and the cool factor for swiping a client’s credit card with my smartphone) still beats dealing with those expensive POS (Point of Sale) machines…that ALWAYS seem to be out of receipt paper.

…But that’s just me