Summary:

The game is on for mobile payments. Square has announced that it has picked up $100 million in a third round of funding, which now values th…

Square

The game is on for mobile payments. Square has announced that it has picked up $100 million in a third round of funding, which now values the dongle-based payment startup, founded by Twitter’s Jack Dorsey, at a cool $1 billion.

The funding was led by Kleiner Perkins Caufield & Byers. Mary Meeker, the former Wall Street star analyst who is now a partner is KPCB, is joining the board.

The funding news was first made by Square itself via Twitter (of course). Jack Dorsey himself then announced Mary Meeker’s appointment. But there have been rumors swirling for weeks that the company was about to get another massive investment.

This brings the total amount of money we know has been invested in the company to around $130 million. In April, Visa made an undisclosed investment in the company.

Square, according to the WSJ, is now processing $4 million in transactions per day with its smartphone-based service — currently for Android and iOS — that uses an attached dongle and an installed app to make its secure payments at points of sale. That $4 million is but a tiny drop the ocean for payments, but it’s a promising early start.

The big test of Square’s staying power will be how its network, and its core device-based service, grow as newer technologies finally start to come online. Google (NSDQ: GOOG) is betting big on its smartphone NFC-based solution Google Wallet, and operators and credit card makers (including Visa) are all also looking to stake out a claim here, too. PayPal earlier this week announced a 100-million user milestone fueled by its use in mobile payments. ViVOtech, a partner of Google’s, this week also announced a round of $24 million.

Sometimes Square’s growth and disruption in the market has resulted in some barbed, public exchanges with competitors, such as the scuffle it had this March with Verifone over security accusations.

The company also counts Vinod Khosla of Khosla Ventures and Obama adviser Larry Summers on its board.

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