Pay by square

What it means

Pay by square is the Slovak standard that packs payment details into a square QR code printed on an invoice or a payment slip. A banking app reads the code and fills in the IBAN, the amount, the variable symbol and the message to the payee.

It is not a payment method or a gateway: it moves no money, it only saves retyping digits. The transfer still runs as an ordinary SEPA credit transfer, and the payer sees and confirms exactly the fields they would have typed.

It is a national standard that foreign banks are not obliged to read. The euro area also has a European QR code for SEPA transfers with a different data layout, and a company with foreign customers is better served by that one on its invoices. For payments outside the euro area via SWIFT neither helps, and the details are typed in by hand.

How it works in practice

Accounting or billing software writes the code straight into the invoice template, so it is built from the same fields that reach the ledger. Firms also drop it into reminder e-mails, where it visibly shortens the path to being paid.

For domestic payments from retail customers it is the cheapest way to cut errors in the symbols. Machine-to-machine document exchange between companies is a different thing: the Peppol network and a structured invoice format.

On advance invoices and payment requests the code shortens the gap between order and payment, because the customer pays straight from a phone. We set the variable symbol in the code to the document number, so the incoming payment is matched in the books automatically and nobody has to work out which order it belongs to.

What to watch out for

The code freezes the details at the moment of printing. If the invoice is corrected but the old PDF goes out, the customer pays the old amount or the old variable symbol, the payment sits unmatched at the bank, and the firm chases someone who has already paid.

When a company issues a credit note or offsets an overpayment, the code on the original invoice still shows the full amount. The customer scans the old code, pays the lot, and an overpayment arises that has to be refunded or offset, with extra work on both sides.