The creator and brainchild of Twitter, the popular micro-blogging web service, reveals his next highly-anticipated project – a way to pay by credit card using your mobile phone.

Jack Dorsey, the creator of Twitter, has unveiled Wednesday the details behind “Square“, a gadget that allows its users to make credit card payments through their cellphones, along with a brief public demonstration.

Square is a card reader about one inch in length that attaches to the headphone socket of most mobile devices. The gadget contains a magnetic strip reader that allows a user to swipe a card, which will then coordinate online with card issuers and banks through a mobile application on the user’s phone. In this manner, the Square system can deduct and/or credit payments for specific purchases.

If all that sounds a little bit too complicated, the Square device is reported to work in much the same manner as the card swipers which are currently in use in most retail stores.

The device, which is scheduled to be available for iPods and iPhones in March 2010, currently has no clear way of generating income for Dorsey, just as Twitter has proven to be significantly unprofitable considering that the micro-blogging service has grown to be immensely popular.

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