Starbucks replaces Square

Two weeks after publicly stating it had lost $56 million processing payments for Starbucks, Square no longer has to worry about future losses.



Starbucks has selected Chase Commerce Solutions, the global payment processing and merchant acquiring division of JPMorgan Chase & Co., to transition processing of all non-mobile payments and U.S. retail card payment transactions in company-operated stores. Chase will also partner with Starbucks on the rollout of chip-enabled payment terminals.



“Our new relationship with Chase Commerce Solutions, combined with the sophisticated chip-enabled technology we are deploying across our U.S. store portfolio, lays the foundation for a coming wave of innovation in our digital payment ecosystem,” said Kevin Johnson, president and COO, Starbucks. “These investments and innovations will both strengthen our payment platform and be increasingly accretive to our business over time."



Starbucks has entered into the agreement with J.P. Morgan Chase & Co. to process payment transactions previously processed by Square. Mobile transactions would continue to be serviced by First Data. Starbucks will also use Commerce Solutions payment and data security solutions. Implementation of both services will begin immediately, with a complete transition expected by spring 2016.



Square had already said it would not renew its existing payment processing contract with Starbucks when it expired in 2016 and it would allow Starbucks to end the contract early. The real blow to Square in the ill-fated Starbucks partnership, which launched with fanfare in October 2012, came in December 2014 when Starbucks stopped accepting mobile payments via the Square Wallet or Square Order apps for in-store purchases, in favor of the proprietary Starbucks mobile app.