Is credit card processing secure?

As a small business owner, you must remain vigilant against credit card fraud. Though most headlines focus on data breaches at major retail chains, small businesses are vulnerable too. Small businesses can improve their credit card processing security measures by doing two things. The first step is to ensure that you comply with the Payment Card Industry Data Security Standard (PCI DSS). Created by Visa, Mastercard, American Express, Discover and JCB in 2006, this standard requires that businesses meet certain criteria to ensure their transactions are as secure as they can be. The second action is to upgrade your card reader to accept EMV (Europay, Mastercard and Visa) chip cards. Most credit cards have a chip embedded in one end of the card, and having the technology to read that chip makes the transaction significantly more secure because the chip is harder to counterfeit than the standard magnetic strip.

How can you avoid credit card processing fees?

Credit card processing companies rely on fees to make their money, so there’s no way to completely eliminate credit card processing fees. If you feel you’re paying too much in fees, you can negotiate with credit card processors to reduce them. If you can accept cards in person instead of over the phone or online, you’ll also save money on fees. Another option is to set a minimum transaction amount that customers must meet before they can pay with a credit card. By doing this, you can ensure you come out on top of the transaction, since it makes more financial sense to pay the fee on a $10 purchase than on a $2 one. Major credit card networks have rules about minimum transaction amounts, so verify that your policy complies with their rules. Similarly, you can move the fee to your customers entirely by using cash discounts or surcharging. Many gas stations use this method, in which a gallon of gas is discounted if you pay with cash. Though this may cause potential customers to take their business elsewhere, it could encourage people who prefer paying with cash to frequent your store more often. If you go this route, check the credit card networks’ rules for surcharging to ensure you follow best practices.

How much are credit card processing fees for consumers?

Consumers usually don’t pay credit card processing fees. Some processors advertise surcharging programs that pass processing fees to your customers. However, these programs aren’t popular with consumers and thus could be risky. Before you implement such a program, make sure you understand your customers and determine if they would accept it or if it would lead them to shop elsewhere. As mentioned above, the credit card networks have surcharge rules.

How long can a merchant hold an authorization?

Authorisation holds vary depending on the status of the transaction and the card issuer’s self-imposed time limits. For most transactions, a merchant has up to 30 days to clear an authorisation hold, though some credit card companies, like Visa and Discover, have significantly shorter time limits before such authorisations “fall off” the account. If you fail to complete a transaction hold, you run the risk of the credit card processing company charging you a misuse fee.

What are the typical credit card processing fees?

Credit card processors charge a variety of fees. Some are fixed while others are negotiable. One non negotiable charge is the interchange fee, which card-issuing banks charge on every transaction made with their credit cards. That fee is passed on to the merchant. The amount charged is based on the type of credit card the customer uses, whether the transaction is in person or online, and the amount of the purchase. The riskier the payment method, the more you pay in interchange fees. The assessment fee or service fee is another non negotiable cost. Payment processors must pay this fee to the card networks, and they pass that fee on to the merchant. The payment processor’s markup is the fee the payment processor charges to use its services. You may be able to negotiate this fee with some credit card processing companies.

What should I look for in a credit card processor?

When you’re looking for a credit card processor that is right for you and your business, consider the fees the processor charges, the terms of the contract, and the service it provides. You don’t want to be stuck with a payment processor that doesn’t have live customer support or is impossible to reach when you have a problem. You also want one that will work with you to ensure you remain PCI compliant, that offers EMV-supported card readers, and that accepts multiple payment methods.

What pricing structures are available for credit card processing?

There are three main credit card processing pricing models: tiered, interchange plus and flat rate. With tiered pricing, the credit card processor charges you the interchange rate, an assessment fee and its markup in different tiers. There are usually three tiers, but some processorss have up to six. The rates depend on the transaction type and credit card used. It’s difficult to compare the costs of processors with tiered pricing. Interchange-plus pricing is a structure in which credit card processors charge you the interchange rate, the assessment fees and their markup. You know exactly how much you are paying for the transaction, since the markup stays the same regardless of the type of card or transaction. With a flat-rate pricing model, the processor charges you a fixed percentage of each sale regardless of whether the customer is using a Visa, Mastercard or any other credit card. There could also be a per-transaction fee that depends on whether the transaction was an in-person or cardholder-not-present payment.

How long does it take to settle credit card sales?

Credit card sales are settled within between24 hours and three days so there’s only a short wait until you see the money in your bank account The length of time depends on the merchant account provider and the type of merchant account you have. Thanks to advances in payment technology, the turnaround to clear credit card sales is faster than it used to be. If you choose a direct processor, like Chase — which is a combined processor and acquiring bank — you can expect shorter time frames.

Does online credit card processing work the same as in-store processing?

In-store and online credit card processing work the same way. The only difference is that, with online credit card processing, the consumer doesn’t swipe or insert a credit card. Instead, the customer inputs their credit card information while checking out online. This information typically includes the card number, the expiration date, the CVV number and the shopper’s billing address. Most credit card processors support both in-person and online payments. The latter is becoming more important as e-commerce and mobile commerce grow in popularity.

Should I avoid tiered credit card processor pricing?

Most small businesses should avoid tiered credit card processor pricing, which bundles the interchange rate, assessment fees and markup into one pricing plan. Because the costs are bundled, it’s difficult to tell how much you are paying for each item. Bundling also makes it hard to compare suppliers. Unless a processor is willing to break out its fees, it’s best to avoid a tiered pricing structure.

Do people pay with cryptocurrency?

Approximately 18% of the U.S. adult population has invested in, traded or used cryptocurrencies, according to eMarketer. Credit card companies such as Visa and Mastercard are getting involved, making it easier for small business merchants to accept bitcoin and other cryptocurrencies via credit card. Future growth in the value cryptocurrency is by far from certain and there’s no guarantee that your investment will retain its value. That said, accepting cryptocurrency as payment could serve as a way for small businesses to distinguish themselves from competitors and gain public attention.

What are the steps involved in credit card processing?

The steps in credit card processing are the same for most product categories and business types. The process starts with the customer selecting an item to purchase. The credit card is then swiped, scanned or entered into a payment terminal. Next, the data is transmitted to be approved. Once it goes through the authorisation, which happens in seconds, the transaction will either go through or be declined. If there are enough funds, the transaction is authorised and completed. The merchant closes out all of the credit card transactions at the end of the day, and the credit card processor’s acquiring bank collects the money from the credit card issuers. The sales are then deposited into the merchant’s bank account, typically in two days or less.

Why do credit card processors offer high-risk merchant accounts?

Not all credit card processors work with every business. Industries that are prone to fraud and chargebacks may have a harder time finding a company to process their sales. Some credit card processors work with high-risk businesses, but they charge more for their services, to mitigate some of the risk. They call their accounts high-risk merchant accounts and charge you more in processing and chargeback fees.

Which businesses do credit card processors consider high risk?

Tobacco and gambling are often perceived as high-risk businesses by credit card processors. Other industries a credit card processor may not work with include pawn shops, subscription services, alcohol sales and firearm dealers.

Best Credit Card Processors of 2024

Our Top Picks for 2024	Merchant One Visit Site	Payment Depot Visit Site	Chase Payment Solutions Visit Site	PayPal Credit Card Processing Visit Site	Helcim Visit Site	Clover Credit Card Processing	Stax	Square	National Processing	Flagship Merchant Services	NA Bancard
Rating	8.0/10	7.0/10	8.6/10	7.7/10	9.4/10	8.3/10	8.7/10	8.6/10	8.3/10	9.0/10	8.2/10
Best for	Easy approval	Low fees	E-commerce	Easy Setup	Fast growing businesses	POS Hardware	High revenue businesses	Customization	Customer support	Flexible contracts	High Risk Businesses
Pricing structure	Flat rate	Flat rate	Custom	Interchange-plus, flat rate	Interchange-plus	Flat rate	Flat rate	Flat rate	Flat rate	Flat rate and interchange-plus	Interchange-plus, flat rate
Contract structure	Monthly	Monthly	Flexible	Pay as you use	Monthly	Monthly	Monthly	Pay as you use	Monthly	Monthly	3 years
Penalty for early termination	No	No	N/A	No	No	No	No	No	Yes	No	Yes
Time to deposit	Within 2 business days	Within 2 business days	Within 2 business days	2 to 5 business days	Within 2 business days	Same day	Same day	Within 2 business days	Within 2 business days	Same day	Next business day
Multiple payment methods supported	Yes	Yes	Yes	No	Yes	Yes	Yes	Yes	Yes	Yes	Yes
Round-the-clock support	Yes	Yes	No	Yes	Yes	Yes	Yes	No	Yes	Yes	No
Review Link	Read Merchant One Review		Read Chase Payment Solutions Review		Read Helcim Review	Read Clover Credit Card Processing Review	Read Stax Review	Read Square Review	Read National Processing Review		Read NA Bancard Review

Cost is one of the most important factors to examine when you’re deciding which credit card processing service to use. You don’t want to overpay by thousands of pounds for the convenience of accepting credit and debit cards from customers.

What Costs Should You Expect for Credit Card Processing?

There are usually three sets of costs involved when you are choosing a credit card processor: rates, fees and equipment costs.

Rates: These are the processing fees you pay for each transaction. Rates are typically a percentage of the total sale amount. In addition to this percentage, card processors charge a few cents per transaction.
Fees: Most processors charge monthly account service fees, which are reflected on your statement, but some processors may levy these fees quarterly or annually.
Equipment costs: The cost of equipment is usually a one-time expense for the hardware needed to accept credit cards. We recommend buying processing equipment upfront whenever possible. Many processors offer leasing (or free equipment), but it’s typically associated with very highcosts.

Credit Card Processing Rates

The rate you pay a credit card processor consists of three parts: the interchange rate, the card brand’s assessment fee and the processor’s markup. The interchange rate and the assessment fee are set by the card networks, and everyone pays the same amount. This portion of the rate is nonnegotiable. However, each processor sets its own margin, so that part is negotiable.

From these three parts, processors create their rate structure or pricing model. There are three main rate structures to know.

Flat-rate pricing: For businesses that process less than around £4,000 per month or have very small sales tickets, flat-rate pricing is usually the most affordable option, because all you pay is a fee for each transaction; there may be no monthly or annual account fees. (Some fees, such as a PCI compliance fee, may still apply.)

Tip

Shop around before committing to a flat-rate processor. Flat rates can be expensive for small businesses.

Interchange-plus pricing: Most industry experts recommend interchange-plus pricing for businesses that generate a lot in credit card sales. That’s because the price you’re quoted is the processor’s markup (the only aspect of pricing that is negotiable), which you can easily compare as you evaluate the pricing of multiple processors.
Tiered (or bundled) pricing: With a tiered pricing model, the processor bundles the interchange rates, assessment fees and the processor’s markup, and separates them into three tiers: qualified, mid-qualified and nonqualified. Companies that use the tiered pricing model usually advertise only the qualified rate (which applies to regular debit cards accepted in person using a card reader) and disclose the other tiers only if you specifically ask for them. It’s impossible to determine the processor’s markup with a tiered pricing model, and the number of tiers (and the types of transactions that go into each tier) vary by processor, so it’s difficult to know if the rates you’re offered are competitive.

What Is the Average Fee for Credit Card Processing?

The average credit card processing fee ranges from 2% to 4% of each sale. Here are some of the factors that determine the per-transaction cost:

The type of card your customer uses (debit, credit, rewards, premium rewards or corporate)
How you accept the card (in-person using a card reader, manually keyed in or online)
The pricing structure your processor uses (flat rate, interchange plus or tiered)

What Fees Come With Credit Card Processing?

Several fees may be charged in addition to the processing rate per transaction. This can become confusing because each processor may charge different fees; it’s hard to know which fees are standard and which ones are superfluous. [Check out some tricks to help you lower your credit card processing fees.]

Processors with flat rates usually don’t charge account service fees, but you still need to be aware of some incidental fees.

Monthly fee: This fee, sometimes called a statement fee, covers customer service and statement preparation. It ranges from around £4 to £8 per month, though it may be higher if it covers additional services like PCI compliance and gateway fees.
Payment gateway fee: This monthly fee covers the usage of the payment gateway, which allows you to accept payments online. The cost depends on the payment gateway, but it is often comparable to the monthly fee (around £4 to £8).
Monthly minimum fee: Some processors require you to generate a certain dollar amount in processing fees each month. For some processors, the monthly minimum is around £20 but others set it higher. If you do not meet this number, you’ll be charged the difference.
PCI compliance fee: All full-service processors require merchants to complete a PCI compliance questionnaire each year. Not all processors charge this fee, but for those that do, the average cost is around £80 per year. If you don’t complete your PCI questionnaire, you’re charged a high PCI noncompliance fee until you do.
Network fees: These fees are charged by the card networks and are passed on to you as either monthly or annual fees. Examples of these fees are Mastercard’s Merchant Location Fee and Visa’s Fixed Acquirer Network Fee.

In addition, some fees are triggered by a certain action. Here are some examples.

Chargeback fee: When a customer disputes a transaction, you’re charged this fee. Each incident usually costs between around £12 and £16, but the fee may be as high as around £35. Some processors refund this fee if you win the dispute.
Address Verification Service (AVS) fee: AVS is an anti-fraud tool that verifies the address and postcode of the cardholder. It usually costs a few cents per transaction.
Voice authorisation: This is another anti-fraud feature that requires you to call the credit card company to provide them with additional information about the transaction. It’s rarely required, but you’re charged for each occurrence.
Batch fee: This is a small daily fee you pay when you close out the day’s sales. It usually costs the same amount as your per-transaction fee, which is typically between around 8pand 24p. Not all processors charge this fee.
Nonsufficient funds (NSF) fee: This is a fee you are charged if you don’t have enough money in your business bank account to pay the fees you owe the processor.

What Equipment Does a Business Owner Need to Process Payments?

At a minimum, you’ll need a phone or tablet credit card reader, or a credit card terminal. Additional hardware, also called peripherals — like cash drawers, receipt printers and barcode readers — can be added to your system.

When you’re shopping for a card reader or terminal, look for one that lets you accept magstripe cards, chip cards, and contactless cards and mobile wallets. The best credit card readers have these capabilities and typically cost less than $80 (usually between £15 and £40). If you prefer a credit card terminal, a basic one with these capabilities usually costs £155 to £235.

Tip

The best credit card reader for small business owners may be a mobile credit card reader used with a smartphone or tablet and the processor’s app. It’s an affordable choice, and you save further because you can email or text receipts to your customers so you don’t have to buy a receipt printer (or paper).

Credit card processing allows you to accept payments from customers who pay using a credit card, debit card or mobile wallet, like Apple Pay or Google Pay. You need to be able to accept these payment methods because that’s how most customers prefer to pay. Cash has declined in use for over a decade as customers and merchants opt for contactless and online payments. With contactless payments, consumers tap their mobile device, contactless credit or debit card, or wearable on the payment terminal to check out. This payment method is quicker and safer than handing cash to a cashier or swiping a credit card. Most of the top POS providers and credit card processors support tap-to-pay.

What Are the Benefits of Credit Card Processing for Businesses?

Accepting your customers’ preferred payment method comes with a couple of additional benefits. First, customers can spend more when they shop with a credit card than when they pay cash. Second, you won’t lose potential sales from customers who don’t carry cash.

What Are the Basic Concepts Business Owners Should Know About Credit Card Processing?

You have a lot of options for credit card processing, but some processors are accessible for nearly every business, even solopreneurs and freelancers.

If you are an entrepreneur or a freelancer who’s just starting out, consider a mobile credit card processing company such as Square, which has flat rates, no contracts, a free mobile credit card processing app, and affordable card readers that connect to a phone or tablet. Then, as your business grows and your processing volume increases, you can add more equipment and features, or you can switch to a more advanced payment processing service.

Here’s why we like mobile credit card processors for new businesses:

Low startup costs. You already have a smartphone or maybe even a tablet; the only thing you need to buy to start accepting credit cards is a card reader. Some processors give you a free swiper when you sign up, but you want a model that accepts chip cards and contactless payments. These readers cost less than £80 (usually £15 to £40).
Pay-as-you-go fees. Most flat-rate processors charge you only when you run a card, and you pay a flat rate for each transaction. This rate looks higher than what some processors advertise, but that’s because you don’t pay monthly account service fees. If you opt for a full-service processor, look for one that has interchange-plus pricing, which is more transparent and economical than tiered (or bundled) pricing structures.
No monthly minimum. Some processors have a monthly minimum, which means you’re required to process enough sales each month to generate a minimum amount in processing fees. If you rarely accept credit cards, you don’t yet know how much you’ll process each month, or you have a seasonal business, you shouldn’t work with a processor that charges this fee.
No contract. Standard credit card processing contracts have three-year terms and automatically renew for additional one-year terms with just a 30-day window at the end of the term to cancel. If you want to cancel your account but you miss that window and then cancel, you’re charged an expensive early-termination fee. If you choose a full-service processor, look for one that has monthly rolling terms. The best credit card processors don’t make you sign a lengthy contract to keep your business.

Why Is Support for Offline Transactions Beneficial to Merchants?

The internet is usually reliable, but outages do occur. If you are a merchant that relies on the internet to process payments, you’re out of luck if your provider doesn’t support offline transactions. Thankfully, most do.

With this type of transaction, the customer checks out normally, with the card data encrypted and stored on the terminal until an internet connection is established. Once the merchant is back online, the information is sent to the merchant’s bank account and card network. That means your business won’t lose sales during an internet outage. If you want to accept card payments outside your establishment, this feature also proves handy.

Our Reviews

Merchant One offers extremely fast approval.
There are no PCI fees for new customers.
Termination fees may apply (around $230 per remaining year in the contract).

Read Full Review

Editor's Rating: 8/10

855-794-1134

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Links to Merchant One

Every business, even if it has a low credit score, needs to be capable of processing credit cards. Merchant One seems to understand this, because it’s one of the best credit card processors for easy approval. Its average approval time is 24 hours, so business owners don’t have to worry about the delays for new-applicant approval that can occur with other credit card processors.

Merchant One provides credit card processing solutions with a variety of processing and POS features. Whether you’re accepting payments online or in-store, Merchant One can support your business. It’s one of the few credit card processors that looks beyond your credit score when reviewing your application. The processor claims to have a 98% approval rate and says it’s willing to work with all companies.

Another benefit of choosing Merchant One is 24/7 customer support for all customers — it’s no wonder the company scores high customer satisfaction ratings. Other features include dashboard customisation for various business types, the ability to use QR codes for payment, and bookkeeping features that make recordkeeping easy for businesses of all sizes.

Besides a well-rounded and useful set of features, Merchant One offers flexible pricing options bespoke to each client’s particular needs. Custom pricing models and packages are available for businesses of all sizes to accept credit card payments.

Merchant One offers extremely fast approval.
There are no PCI fees for new customers.

Termination fees may apply (around $230 per remaining year in the contract).

The company is transparent about its pricing.
You’re not bound by a lengthy contract.
Payment Depot is not available to merchants outside the U.S.

Editor's Rating: 7/10

(877) 755-3812

Links to Payment Depot

For small businesses that process a high volume of card transactions, it can get expensive very quickly if you choose the wrong credit card processor. Payment Depot’s membership-based pricing and wholesale rates will likely lower your processing costs, which is why we chose Payment Depot as our best pick for low fees.

With Payment Depot, customers pay a flat rate each month and a low transaction fee. There are no setup fees, cancellation fees, monthly fees or long-term contracts. Businesses that process a high volume of payments stand to save the most when working with this credit card processor.

Payment Depot offers four plans based on monthly processing volume.

Like other credit card processors, Payment Depot also offers a virtual terminal (in partnership with SwipeSimple) for accepting credit card payments over the phone. The terminal has an easy-to-use and navigable dashboard from which you can track stock sales and supplies, send customer invoices, schedule recurring payments, issue receipts and more. POS tools are included with Clover and Vital Select, which let you view your sales, generate reports and manage employees. Additional hardware is available from Dejavoo, Poynt and FirstData.

When you sign up with Payment Depot, you receive a merchant account that allows you to accept payments in-store, online and via mobile devices. Payments are typically deposited into your account in one or two business days. Payment Depot also provides integrations with QuickBooks, Shopify and WooCommerce.

The company is transparent about its pricing.
You’re not bound by a lengthy contract.

Payment Depot is not available to merchants outside the U.S.

Chase offers both flat-rate and interchange-plus pricing.
Chase Payment Solutions has POS and e-commerce capabilities.
The flat-rate pricing can be expensive if your business has a high sales volume.

Editor's Rating: 8.6/10

Links to Chase Payment Solutions

If you own an e-commerce business or already process payments through PayPal, you should consider Chase strongly as a potential credit card processor for your company. As one of the largest banks in the U.S., Chase offers the convenience of a bank and a processor rolled into one. By choosing a direct processor such as Chase, you can negotiate rates and contract terms without a middleman. Chase also offers flat-rate pricing.

With Chase Payment Solutions, small business owners in the e-commerce space enjoy seamless integration with PayPal. The company also offers the highly rated Orbital Virtual Terminal, which allows business owners to use a computer as a credit card terminal. An optional USB-connected card reader is also available for added convenience. Although the virtual terminal is free, business owners are required to pay for the card reader.

Another impressive feature is the Chase Customer Insights, which goes beyond tracking sales and trends to give you quality insights into your target audience’s demographic data — age, gender, income and more. These insights are drawn from Chase’s proprietary credit card data on customer purchasing habits, which you can filter by channels and number of times your customers purchase similar goods and services. You can even identify differences in your company’s performance and compare it to similar businesses in your area to uncover potential competitive advantages.

Chase offers both flat-rate and interchange-plus pricing.
Chase Payment Solutions has POS and e-commerce capabilities.

The flat-rate pricing can be expensive if your business has a high sales volume.

PayPal offers a familiar user interface and easy setup, which enables merchants to establish a “pay now” option for fast payments.
PayPal is compatible with most major business services and easily integrates with other solutions.
PayPal’s rates vary significantly by transaction type and across international borders.

Editor's Rating: 7.7/10

Links to PayPal Credit Card Processing

PayPal is a familiar name in secure payments and consumers have long trusted the platform to send money to friends, family and businesses. For merchants, PayPal represents an easy-to-setup and use solution that can help them begin accepting payments quickly. One impressive feature is PayPal’s “pay now” button, which makes it simple for customers to complete a transaction. The platform also offers QR code transactions and email transactions for cardholder-not-present sales.

PayPal’s pricing can vary depending on the type of transaction you’re conducting. For example, when using PayPal Checkout, expect to pay 3.49% plus a small fixed fee. At the same time, a QR code transaction would cost 1.90% plus a fixed fee. Email transactions represent a different cost still, at 2.99% of the overall transaction value. If your customers like to pay in a variety of ways, these different fees can be a lot to stay on top of.

PayPal offers a familiar user interface and easy setup, which enables merchants to establish a “pay now” option for fast payments.
PayPal is compatible with most major business services and easily integrates with other solutions.

PayPal’s rates vary significantly by transaction type and across international borders.

Helcim posts its rates and fees on its website.
The monthly fee includes PCI compliance, virtual terminal access and an online store.
Some competitors offer lower online processing rates.

Editor's Rating: 9.4/10

Links to Helcim

Helcim has low rates as well as automatic volume-based discounts, and it’s one of the few companies with a rate lock that guarantees its margin won’t increase over the life of your account. The amount a business pays depends on sales volume and transaction types. As sales increase, the cost margin decreases.

Helcim has no long-term contracts, monthly minimums or fees, which makes it a great choice for seasonal businesses with high-volume transactions at specific months of the year. E-commerce businesses also benefit from the low barrier to entry that comes with zero contracts or monthly fees. Payouts take two business days, which is longer than some processors that offer same-day fund deposits, but merchants still benefit from Helcim’s transparent pricing, lower rates and round-the-clock support.

Helcim is an all-inclusive credit card processor. It has in-person, online and mobile processing, plus more advanced solutions, such as invoicing, virtual terminal, recurring payments, a hosted online store and payment pages, and online food ordering. The company plans to release an all-in-one, stand-alone smart terminal with a POS, stock management, built-in thermal receipt printer and customer management tools for merchants who want to process more in-person transactions. Currently, Helcim offers a handheld card reader for around £85.

Helcim posts its rates and fees on its website.
The monthly fee includes PCI compliance, virtual terminal access and an online store.

Some competitors offer lower online processing rates.

Clover has flat-rate pricing.
It only requires a monthly rolling contract.
With Clover, First Data is also your merchant acquirer.

Editor's Rating: 8.3/10

Through Clover’s virtual terminal, you can accept payments without POS hardware. Clover offers a variety of subscription pricing plans (Starter, Standard and Advanced), depending on the type of business you operate. These cost as low as $11.78 for Starter plans, and up to around $230 for certain Advanced plans. You will also pay at least 2.3% plus around 8p for in-person purchases, and 3.5% plus around 8p for virtual or cardholder-not-present purchases.

The credit card processor allows business owners to take advantage of its Rapid Deposit service, which makes funds from credit card sales available in minutes. This is another benefit that makes Clover a top pick for new business owners who prefer not to wait the standard one to two days for funds from sales to clear.

Besides credit card processing, Clover offers POS software and hardware (card readers, handheld devices and terminals) with access to inventory management, customer management, marketing and reporting tools. The Clover Flex handheld terminal and Clover Go contactless reader both allow you to accept credit card payments. The Go device was recently upgraded with invoicing capabilities as well. You can purchase or lease Clover POS equipment directly from the company or buy the equipment on your own. Clover maintains a large network of resellers so shopping around to find the best deal for your POS hardware is worthwhile.

Clover has flat-rate pricing.
It only requires a monthly rolling contract.

With Clover, First Data is also your merchant acquirer.

Stax offers flat-rate pricing.
Same-day funding is available.
The pricing structure is not suitable for low-volume businesses.

Editor's Rating: 8.7/10

Stax is a great option for established high-turnover small businesses. Instead of requiring a contract, the company charges a monthly subscription fee. The exact fee depends on the plan, but it’s worth noting that all plans are geared toward businesses that process up to around £400,000 per year. For customers with annual revenues exceeding £400,000, Stax offers bespoke pricing. Stax also charges fees based on transaction volume, and these processing fees are added to the monthly subscription fees.

Stax’s pricing structure can add up to major savings for businesses that process large volumes of transactions. For businesses with a turnover of less than £400,0000 per year, though, Stax would likely be a more expensive option. The credit card processor is well aware of this, so if you own a business with a low volume of transactions, your Stax representative may advise you to consider more suitable credit card processors.

Stax offers a number of features like brand customisation options for invoices and receipts, as well as add-on features for each plan. Plus, it integrates with a wide range of apps, including QuickBooks and HubSpot, and payment gateways like Magento and WooCommerce. [Learn the difference between a payment processor and payment gateway.]

This fall, Stax announced the acquisition of payment company APPS. This will result in a large rollout of new Stax features later in the year including expanded payment processing and chargeback management capabilities.

Stax offers flat-rate pricing.
Same-day funding is available.

The pricing structure is not suitable for low-volume businesses.

There are no monthly or annual fees.
The basic POS app is free and can be augmented as your business grows.
The customer service isn’t as reliable or available as some competitors’.

Square stands out for its low-flat-rate pricing model. The company charges 2.6% plus around 8p for in-person payments, and 3.5% plus around 12p for cardholder-not-present transactions. The cost for purchases through your Square online store, Square online checkout, e-commerce API or an invoice is 2.9% plus around 24p. There are no monthly, gateway, setup, PCI compliance, early termination or annual fees, nor is there a chargeback fee. (Most processors have steep chargeback fees.) Square does offer several subscription plans with additional features. These range in price from $22.75 to £54.25 monthly.

We were also impressed with Square’s credit card processing app. Not only can you process payments from nearly anywhere, but the POS software features also help you track and manage inventory, collect and analyse customer data, and run reports on sales and inventory. You can accept credit card payments by phone, including Apple Pay, NFC payments and iPhone payments. Most recently, Square introduced its second-generation reader. This new product pairs with a smartphone to accept chip cards and contactless payments. We also love Square’s new AI-powered tools. These include menu and image generators, and a content creator for emails and communications.

Your business can also accept bank transfer payments on your Square Invoices software. When your business sends a Square Invoice, customers can click the payment link, provide their bank details and complete the payment online. Square also offers the Tap to Pay feature for iPhone users in the UK. Using the Square app, merchants can accept contactless payments made from Apple Pay, credit cards or other digital wallets.

There are no monthly or annual fees.
The basic POS app is free and can be augmented as your business grows.

The customer service isn’t as reliable or available as some competitors’.

National Processing has some of the lowest interchange-plus rates.
All customers are assigned a dedicated account representative.
National Processing charges a termination fee.

National Processing is our budget pick because it charges lower interchange-plus rates than competitors. It also has a rate-lock guarantee that ensures you don’t unexpectedly pay more to process card payments.

This credit card processor offers three pricing models: one for retailers, one for restaurants and one for e-commerce companies. All three plans cost around £7.80 per month and include a rate-lock guarantee. Restaurants pay 0.14% plus around 5p per transaction, retailers pay 0.18% plus around 8p per transaction, and e-commerce businesses pay 0.3% plus around 12p per transaction.

Unlike other card processors, National Processing also charges a PCI compliance fee. And although you aren’t forced to sign a long-term contract, National Processing does charge a termination fee. The company will waive this fee if your business is sold or closed, or if National Processing can’t match or beat a rival’s credit card processing rate.

A unique feature National Processing offers that we’ve not found in most credit card processors is its Referrals program and Merchant Services Affiliate program. These programs give merchants opportunities to earn residual income based on their business network and influence in the marketplace.

National Processing has some of the lowest interchange-plus rates.
All customers are assigned a dedicated account representative.

National Processing charges a termination fee.

There are no long-term contracts or cancellation fees.
You can choose between interchange-plus and tiered processing rates.
Flagship charges a PCI compliance fee.

Editor's Rating: 9/10

Small business owners don’t want to be locked into long-term contracts with exorbitant termination fees; they want flexibility and freedom. That’s what they’ll get with Flagship Merchant Services, our pick for the best credit card processor for flexible contracts.

Flagship Merchant Services is a full-service payment processing company that bills you monthly and has no cancellation fees. The credit card processor offers two pricing models: the interchange-plus rate and a tiered pricing model.

The tiered pricing model can get confusing, as there are multiple options. Flagship doesn’t list its prices online for either pricing model; you will need to contact the company to get a custom quote.

Once you fill the online form with your average monthly processing volume and business contact information, the Flagship team will review and generally approve within two business days. Flagship will send you a credit card terminal and a representative from the company will train you on how to use it. If you need further assistance, you can call Flagship support on its freephone customer service number 24/7.

Flagship Merchant Services also sells a variety of credit card processing hardware, so you can easily accept payments in-store, on the go and online. For example, its simple credit card terminal with a built-in PIN pad is a good option for new businesses while its comprehensive POS system may be a better option for more established businesses.

Flagship sells terminals and POS equipment from Verifone and Clover, among other processors. It is possible to get free equipment from Flagship (a free Clover Mini credit card processing terminal), but you must sign a three-year contract. We recommend that you purchase a card processing reader or terminal instead so you can keep your monthly supply terms. Your Flagship account also comes with an online reporting tool that you can use to analyse your sales data.

There are no long-term contracts or cancellation fees.
You can choose between interchange-plus and tiered processing rates.

Flagship charges a PCI compliance fee.

NA Bancard doesn’t require long-term contracts and allows for monthly service.
A wide range of business tools and useful features can help businesses remain financially stable.
Pricing is not transparent and customer support options are limited.

Editor's Rating: 8.2/10

NA Bancard offers a credit card processing service that supports businesses many other processors consider too high risk to deal with. Its flexible terms and month-to-month service means it is a suitable option for any business, regardless of size, industry or transaction volumes. Every NA Bancard client receives access to a dedicated account manager that will act as a point of contact for all support needs.

NA Bancard doesn’t charge termination fees, though its pricing structure isn’t published on its website, which makes it difficult to know what the overall costs to your business will be. Still, NA Bancard provides clients with free equipment, which can be a significant cost savings compared to processors that require merchants to lease or buy equipment needed to run debit and credit card transactions. Overally, we found NA Bancard to be a strong choice for high-risk businesses in need of merchant processing support.

NA Bancard doesn’t require long-term contracts and allows for monthly service.
A wide range of business tools and useful features can help businesses remain financially stable.

Pricing is not transparent and customer support options are limited.

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