Right now, Square is only working with a select group of companies, but it expects to expand in 2010. Square is currently working on the iPhone and iPod Touch. The whole idea is to provide a cheap way for small companies to charge by credit card given the dominance of paying by plastic these days. No word on how much the dongle will cost, but users apparently won’t have to sign any contracts and there won’t be a monthly fee.

On the website, Square lists the benefits of using their platform, which includes sending receipts by email or text message instead of printing them out; using photo verification, Square users can visually confirm you are the card holder; and providing rewards programs, in which Square keeps track of a user’s visit, rather than a punch card. The company will also donate a penny to a cause of your choice with each transaction.