Square adds gift cards post-Starbucks

After landing a huge deal with Starbucks, it would have been expected for Square to slow down a little and enjoy it's victory. But no, Square is continuing to innovate.

The company has recently released gift cards for the latest version of its Wallet app for the iPhone and Android. The new feature allows a user to send and receive gift cards without having to carry around a physical card.  This could be a huge opportunity for Square, as it breaks into a $100 billion dollar annual market.

The company also updated it's merchant app called Register app in order to make it capable of accepting gift cards.

The popularity of digital gift cards is growing. Square has joined the ranks of companies trying to digitalize the traditional gift card business and move that business to mobile or web. Digital gift cards may find favor with consumers that tend to lose their real-world, plastic counter-parts. Digital versions could reduce such issues by tying them to a phone, tablet or online account.

In terms of winning new customers, the digital gift cards could also do wonders for Square. As users receive gift cards, they will be ushered over to the company in order to redeem their value. This will cause increased downloads of the Square app. Merchants may also immediately see the value in working with Square, as the gift card market will have eager consumers looking to spend their digital gift cards. This could convince more store owners to employ Square as a payment option.