Square vs. NFC: what the differences will mean for you.

It's taken nearly a decade for carriers, phone manufacturers, payment processors, and retailers to finally start cooperating on making near-field communications (NFC), a mobile payments standard, a reality.

When last fall, the pieces began to fall into place: manufacturers began announcing new phones with NFC, credit card companies began authenticating mobile payment platforms, merchants began upgrading their credit card readers.

Then on Monday, Twitter founder Jack Dorsey breezed into an auditorium at the Techcrunch Disrupt conference in New York and one that virtually stores every card, receipt, and menu you'd stuff in your wallet onto your phone and facilitates transactions at the point of sale. Suddenly, headlines filled the Internet about how Square was going to displace NFC. The New York Times' Claire Cain Miller said Square challenges cash registers, POS terminals, mobile manufacturers. Business Insider's Dan Frommer was convinced Square will eventually displace payment processing companies, including one of its early investors, Visa.

Best of all, Square is available right now. Well, at at 50 mom-and-pop shops across the country, that is.

But what does Dorsey's announcement mean for you? PCMag has compiled a quick and dirty comparison of the Square vs. NFC experience:

1.) What you'll need to start:

Square: Consumers will need an Android or iOS smartphone and purchase the Card Case app ($1), which comes with a free Square reader. Merchants will need an Apple iPad to run the Square Register app, which essentially turns the iPad into a card processing terminal. Square Register also stores all transactions (including cash ones) and creates virtual receipts, prompting Dorsey to compare the feature to opening a bar tab.

For more on transaction fees and ease of use, be sure to check out our earlier

NFC: Consumers need a smartphone equipped with an NFC chip, which RIM, Nokia, and Google have announced will come out this or next year; Apple is also expected to equip its next iPhone and iOS 5 with a payment platform as well. Merchants need a reader that accepts NFC. Most readers, like those by Verifone, offer software upgrades with NFC so merchants don't have to purchase an entirely new reader.

2.) Walking through the actual mobile payment experience:

Square: Consumers go to a participating retailer, check in on the spot with their phones (like on Foursquare), order an item, and then walk out. The purchase is instantly added to the user's tab and charged to the credit card linked to their account. A text message is sent to the consumer notifying them once their credit card has been charged.

NFC: Consumers pay by waving or tapping a smartphone against an NFC-supported payment terminal that doesn't even have to be attended. The item is immediately charged and will show up on the credit card bill.

3.) A quick note on security:

Square: We haven't seen heard about how Square encrypts payments or credit card information, but in March Verifone CEO Doug Bergeron lashed out on Square's security in a scathing video.

Visa, Mastercard, and other payment processing companies and banks have been working with the mobile industry (notably, SIM card manufacturers and terminal readers) to secure card storage and authenticate transactions as it does for e-tailers (which is why you sometimes see a "Verified by Visa" logo at your online point of purchase.)