Twitter inventor working on Squirrel?

As per various reports, after Twitter, its co founder Jack Dorsey is working on Squirrel. So what is the concept?

Squirrel is a service that will allow those with an iPhone to become a merchant. Basically, it’s like making use of your iPhone to take payments just like the wireless credit card swipers. While you carry your iPhone around, you can make use of it to swipe a credit card to collect payments.

Squirrel will be both a device add-on to the iPhone and an application to be installed on the iPhone. The physical device looks something like an acorn, that’s why it’s codenamed Squirrel.

The Squirrel will be useful to many people around. It could be used by sales people to collect payment immediately after booking an order. Restaurants may use also use Squirrel to replace their existing wireless credit card swipers.

Having said that, since iPhone has been a big flop in India, Squirrel may not have too many takers unless it is made compatible with all handsets. Moreover its quite difficult to understand what purpose this will solve.