Fast growing mobile payments firm Square has been in talks with banks including Goldman Sachs and Morgan Stanley about a possible IPO next year, according to The Wall Street Journal.

So far no bank has been hired by Square, whose CEO is Twitter chairman Jack Dorsey (pictured), and the timing of any offering could change, depending on market conditions.

Square has risen to fame with a card reader that plugs into Apple and Android smartphones and tablets so they can act like cash registers and accept debit and credit card payments.

The Square service has proved very popular with small traders who have previously not accepted cards, aided by the firm’s competitive rates for processing payments.

According to sources, Square’s sales will approach $1 billion in 2014. This figure represents what Square retains from the approximately $30 billion in transactions it expects to process next year before it passes a big chunk on to partnering credit card companies.

Sales this year will be about $550 million on total payment volume of around $20 billion, said sources. Dorsey has publicly said Square does not make a profit although he has talked internally about a move into the black by 2015.

However, despite its upward trajectory, Square faces numerous rivals and the entry barriers to its market are relatively low. Hence its efforts to diversify into additional services such as enabling consumers to make in-store payments.

It is also attempting to pitch itself to larger retailers. Clients include Starbucks, which is also a strategic investor in Square. The coffee shop’s CEO Howard Schultz took a seat on the payments firm’s board, although he was recently replaced by former Goldman Sachs CFO David Viniar, a move which kicked off speculation the mobile payments firm is plotting an IPO.