Terminal giant VeriFone's Payware Mobile has spent the last two years competing with Square, Intuit's GoPayment and, most recently, PayPal Here. Now the firm has unveiled Sail, which also consists of a free Android or iOS app and card reader that securely encrypts transaction data, enabling merchants to accept payments through their handsets.

However, the new platform is also open to banks, technology companies and sales organisations, meaning that they can build their own payment or marketing tools on top of VeriFone's infrastructure. The platform includes a mobile SDK and secure gateway with end-to-end encryption, real-time merchant fraud screening and boarding APIs, merchant processing and settlement services, and the ability to connect to third party marketing, loyalty and social media tools.

Meanwhile, bar code scanning technology in the app lets retailers offer quicker retail check out and item level data integration opportunities for third-party partner services such as loyalty.

Douglas Bergeron, CEO, VeriFone, says: "VeriFone has created a unique open ecosystem that builds on our payment-as-a-service vision to foster innovation in the developer and payments communities and maximize choice for small to medium-sized businesses. We are delivering a flexible experience with the level of security and reliability that businesses and consumers have come to expect from VeriFone."

Verifone will charge the same 2.7% transaction fee as Square with an option of a lower 1.95% fee for those willing to pay $9.95 a month.

The US dongle and app market has developed into a lucrative and competitive area over the last two years. With a million customers, Square has so far dominated, surviving an aggressive attack on its security credentials last year by VeriFone.

However, PayPal has emerged as a dangerous rival, signing up 200,000 merchants within weeks of launching 'Here' and VeriFone hopes that its new, open, system and established network of merchants will prove a winning combination.

Yet another player, PayAnywhere, says its version, which works with iOS, Android and BlackBerry devices will begin shipping to US retailers this month and Heartland Payment Systems today unveiled an Android-specific system, called Mobuyle, for its restaurant customers.