Credit card processing companies complete transactions behind the scenes of a business’ point-of-sale (POS) system or website. There are two types of small business credit card processing companies: all-in-one processors with POS functions, and processors that connect POS to the interchange. We compared dozens of processing solutions by price, security, and features to determine the best.
Top 6 Small Business Credit Card Processing Companies 2019
|Credit Card Processing Companies||Best For|
|Square||(Best Overall) Most businesses wanting a quick start + low-cost processing and free POS features.|
|PayPal||Online businesses looking for a user-friendly solution.|
|Stripe||Membership-based businesses and businesses with recurring payments.|
|Dharma||Lowest rates for established businesses with average transactions over $20.|
|TSYS||Businesses that have a monthly sales volume over $30,000.|
|Chase Merchant Services||Businesses that want to work with a traditional bank.|
How We Evaluated Credit Card Processing Companies
Processing companies charge a fee for each transaction they process, so even small differences can add up, which is why we heavily weighted fees in our comparison. We also looked at whether or not each processing company offers mobile solutions and ecommerce integrations so small businesses can accept payments online and with their phones. We also evaluated how each company integrates with popular POS systems.
The criteria we used to evaluate the best credit card processing companies for small businesses include:
- Fees and total potential cost – We looked at transaction fees, whether or not each company offers volume discounts, and how much their card readers cost.
- Customer support – We looked at what level of support each company provides: phone support, email, what hours they are available, and whether or not support is free.
- Ease of use – Businesses should be able to rely on the fact that their card processor will work seamlessly every time.
- Mobile functionality – We looked at whether or not each processing company offers mobile payment solutions.
- Ecommerce capabilities – We looked at whether or not each processing company offers online payment solutions.
- POS integrations and features – We looked at how each processing company integrates with popular POS systems.
Based on the above qualifications, Square is our top choice for small business owners. It is super simple to set up and to use for in-store, mobile, and online payments. Square also comes with a free POS system. Square’s credit card processing rates are not the lowest, but there is no contract and the flat-rate fee structure is very transparent.
Square: Best Overall Credit Card Processing for Small Businesses
Square is an all-in-one, PCI compliant, cloud-based credit card processing and point-of-sale (POS) system. Square is the overall best choice for small businesses because it is easy to use, is competitively priced, and comes with a free POS system. Square offers some of the lowest processing rates for businesses with an average sale below $20. Square has no contract or monthly fee, is free to set up, and comes with a free magstripe card reader to start accepting payments right away.
Square has a flat-rate fee structure. There is no contract and no minimum or monthly fees. Businesses pay a flat rate for each transaction.
Square’s credit card processing fees are:
- 2.9% + 30¢ for online payments
- 2.75% for mobile and in-store payments
- 2.6% + 10¢ for Square Terminal payments
- 2.5% + 10¢ for Square Register payments
Square can be used to accept credit card payments in person, through your phone, via professional invoices, and on your website. Businesses receive funds from credit card payments less the flat-rate processing fees in their bank accounts next day. Businesses can also pay an additional 1% fee to receive funds same-day.
Additional Square features include:
Square has several different hardware options to choose from. Every free Square account comes with a free magstripe card reader that can accept card payments on any iPad, iPhone, or Android device. Square also has Square Terminal for $399, an iPad stand for $169, and Square Register for $999, all of which have monthly payment plan options. Check out our article on How to Use Square to Process Payments & Run Your Business for a full equipment break down.
Square makes it super easy to accept mobile payments. Square’s mobile credit card processing features include:
- Easy set up – Square comes with a free magstripe card reader that anyone can use to accept payments with their iPhone or Android smartphone.
- Flat-rate fees – Square charges a 2.75% fee for mobile payments on the magstripe reader. No minimums or setup fees.
- Free POS – Square also comes with a free, cloud-based POS system that makes it easy to ring up mobile transactions and analyze sales data.
- Offline payment processing – Square can accept swiped card payments even without an internet connection.
Square has a lot of different options for businesses looking to accept payments online, including:
- Integrating with popular ecommerce platforms – Square Payments works with Vend, WooCommerce, and Wix.
- Building an online store – Businesses can build an ecommerce site through Square with Weebly for as low as $8 per month.
- Setting up a custom payment solution – Square APIs let businesses set up custom payment solutions on their websites.
Square has its own free proprietary POS system that we recommend using with Square Payments. The free system includes basic inventory management, product and menu management, sales data, and a customer directory. Businesses can purchase additional features like loyalty programs and email marketing. Square also has POS solutions for retail and restaurants, which are both $60 per month.
What Square Is Missing
Square’s biggest flaw is that it doesn’t offer flexible credit card processing rates. Square’s rates are ideal for a small business, startup business, and any business that has an average sale below $20. But, if you have higher average sales, or a high monthly sales volume (over $30,000 month), you can save money by using another card processing company like TSYS or Dharma.
Generally, reviews for Square are positive. Businesses like that it is easy to use, free to set up, and doesn’t require a contract. However, some users report issues with their accounts being deactivated. Visit our Square Review Page to read more feedback from business owners.
Get Started with Square
Square is free to set up and doesn’t require any hardware purchases. The platform also includes a free POS system. It’s a great option for any small business or businesses that are just getting started and want to keep costs low. Visit Square today to set up your free account.
PayPal: Best User-Friendly Card Processing Company for Online Businesses
PayPal offers a credit card processing solution for businesses to accept payments online, in-store, and over mobile. PayPal is great for online sellers because it also allows businesses to accept PayPal payments, which can increase overall sales. PayPal is a favorite payment method for many online shoppers, and accounts for 20% of all ecommerce transactions.
PayPal has flat-rate payment processing fees similar to Square. However, PayPal offers more payment options for online businesses, including PayPal, PayPal Credit, and Venmo.
PayPal fees include:
- $0 set up or cancellation fees
- Monthly fees between $0 and $30 dollars
- Free PayPal Here POS software
PayPal vs Square Card Processing Fees
|Card Processing Fees for Swiped Payments|
|Online Card Processing Fees|
|PayPal, PayPal Credit, and Venmo Payments|
PayPal is a great option for online businesses because customers can pay without having to directly enter any card information if they already have a PayPal or Venmo account set up. This option helps to ease security concerns and also provides a more seamless checkout process with fewer clicks.
Additional PayPal features include:
PayPal has credit card readers called PayPal Here, which are powered by the PayPal mobile app and can be used in-store or on the go.
PayPal Here hardware options include:
- Mobile card reader: $14.99
- Chip and swipe reader: $24.99
- Chip and tap reader + charging stand: $79.99
- Chip card reader with pin for in-store purchases: $99.99
Similar to Square, PayPal has a free app with a basic POS interface, called PalPal Here, for accepting payments on the go. However, unlike Square, PalPal does not have an offline mode. So, in order to accept mobile payments with PayPal, you need an internet connection.
PayPal is a fantastic option for ecommerce businesses. It offers a ton of different payment options in addition to standard credit cards. Plus, the online transaction fees are comparable to the other solutions on our list, such as Square and Cayan.
What PayPal Is Missing
PayPal is a great credit card and payment processing company for online sellers. Even though PayPal also offers a free POS system, it is very limited compared to Square’s free system. However, if you are primarily or only selling online, that is a non-issue.
Overall, PayPal has really great reviews from both small business owners and shoppers. It is very easy to use on both ends, and offers customers an additional payment method. Some negative reviews say that PayPal’s customer service can be unsatisfactory. Visit our PayPal Business Review Page for more feedback from business owners.
Get Started with PayPal
PayPal is free to use and is a great asset to your online store. Setup your free account today to offer customer-friendly payment options for your online business.
Stripe: Best Online Credit Card Processing Company for Recurring Payments
Stripe is a cloud-based payment processing system that allows small businesses to accept payments online. Stripe is designed to handle more complex payment situations including subscriptions, recurring fees, and storing card data. Stripe is the best solution for businesses that process recurring payments for subscriptions or memberships.
Stripe offers two kinds of pricing: pay as you go and enterprise. The pay as you go plan charges 2.9% + 30¢ per transaction, which is consistent with what most companies charge for online payments. For enterprise plans, businesses need to contact Stripe for a custom quote. Other than the transaction fee, Stripe is free to use and set up.
Stripe vs Square Transaction Fees
|Online Credit & Debit Payments|
|ACH Direct Debit|
Stripe accepts credit and debit card payments, ACH credit and debit payments, Apple and Google Wallet payments, AliPay, and international credit cards.
Additional Stripe features include:
Stripe is only for online payments, so no hardware is necessary. While this certainly keeps costs low, Stripe’s inability to work with mobile payments or POS systems could easily rule it out as a card processing option for businesses that want to sell via multiple channels using the same credit card processing company. For businesses selling via multiple channels, we recommend Square or PayPal.
Stripe is an online-only card processing solution and doesn’t offer any mobile features. For mobile payments, we recommend Square because it has a free POS, card reader, and can accept payments offline.
Stripe has a lot of developer tools that make it easy for companies to build subscription and automatic billing solutions with solid fraud protection. Stripe also accepts ACH payments, which is an ideal option for memberships and recurring fees. Stripe can be used with just about any major ecommerce platform or on any custom website.
Stripe is only for online payments and therefore doesn’t work with any in-store POS systems. For businesses that will primarily sell in-store, consider Square, Cayan, Chase, or Dharma.
What Stripe Is Missing
Stripe is obviously missing mobile and in-store capabilities, which will rule it out as a practical solution for many business owners. However, businesses that dealt primarily with online payments and have subscriptions, memberships, or any kind of recurring payment setup will be happy with Stripe.
Businesses like that Stripe is a simple platform that is straightforward and easy to use. Users also like the many different payment options that Stripe provides. Some negative reviews say that Stripe’s customer service has room for improvement. Visit our Stripe Review Page to read more feedback from business owners.
Get Started with Stripe
Stripe is free, easy to set up, and requires no contract; businesses simply pay as they go. Stripe is the ideal credit card processing company for businesses with recurring online payments. Visit Stripe to create your free account.
Dharma: Best Credit Card Processing Company for Established Business
Dharma is a merchant services provider that allows businesses to accept credit card payments in-store and online. Dharma has some of the most competitive interchange-plus pricing available, which is a good fit for businesses that have average sales over $20. However, Dharma only works with businesses that do $10,000 or more in monthly sales.
Dharma offers interchange-plus pricing like Cayan, but Dharma’s fees are actually lower. See the table below for details.
Other Dharma fees include:
- $0 setup costs, annual fees, or PCI compliance fees
- $20 monthly fee
- $25 closure fee
Dharma Card Processing Fees
|Interchange + margins|
|Card assessment fees|
Dharma offers low fees and a transparent pricing structure that is a great option for businesses that can meet the $10,000 monthly minimum. Dharma also integrates with many card readers, terminals, and POS systems.
Additional Dharma features include:
Since Dharma is a merchant service provider, it can be used for in-store, mobile, and online sales. Their recommended hardware options include:
- Countertop terminals – Verifone terminals for chip and pin payment: $179
- Poynt smart terminals – Touchscreen and mobile payment terminal: $699
- Clover POS – Full-feature POS system: starts at $499
- Clover Go – Mobile card reader: $99
Dharma works with Clover Go, the mobile version of Clover POS, to accept mobile payments on the go. However, Clover requires an internet connection. Our top pick for mobile payments is Square.
Dharma integrates with many popular ecommerce platforms via API connections. Online sellers can pair Dharma with Authorize.net to easily accept payments on nearly all ecommerce platforms.
Since Dharma is a merchant service provider, it works with many POS systems including ShopKeep. Like Cayan, Dharma does not have any built-in POS functions like Square does. It is meant to be used with another POS or business management software.
What Dharma Is Missing
Dharma is strictly a payment processing company, so businesses looking for an all-in-one solution should consider another option, such as Square. Unlike Square, PayPal, and Stripe, which are more or less plug-and-play solutions, Dharma has a difficult approval process. They only work with high volume businesses that process $10,000 per month or more.
Overall, Dharma has great online reviews. Their customer service is quick to respond. Businesses also like that Dharma’s pricing is transparent. Many of the negative reviews online are from companies that were rejected during the approval process.
Get Started with Dharma
Dharma certainly isn’t right for everyone, but their low prices are a great option for established businesses that process over $10,000 per month and are looking to cut down on card processing fees. Visit Dharma to learn more and start the approval process.
TSYS: Best Credit Card Processing Company for Businesses with a High Sales Volume
TSYS is a merchant services provider that lets small businesses process credit and debit cards in-person through card terminals, via mobile processors, and online with payment gateways. TSYS offers competitive processing rates and a tiered pricing structure. Overall, TSYS is a good option for businesses with a monthly sales volume over $30,000 because they can save money with lower processing fees.
Like many credit card processing companies, TSYS doesn’t disclose any specific rates on their website. However, here is an estimate of some of their fees:
- $25 monthly sales volume minimum
- Cayan’s contracts are a standard 3-year term; however, there is no early cancellation fee
- $7.95 per month statement fee
- $99 annual PCI compliance fee
TSYS vs Square Card Processing Estimates
|Credit Card Processing Fees|
|Debit Card Processing Fees|
|Online Processing Fees|
|Keyed-in Card Processing Fees|
TSYS has lower processing rates than Square, but it also has statement fees, PCI fees, and monthly minimums that Square does not have, which is why TSYS is only a good option for larger businesses. According to our research on Best Merchant Services, TSYS is the best option for businesses with a monthly sales volume greater than $30,000.
In addition to low processing rates, TSYS also offers around-the-clock customer service, including phone support, whereas Square only offers phone support to customers between 6 a.m. and 6 p.m. Pacific Time.
Additional TSYS features include:
Like Square, TSYS also provides a free magstripe card reader that is ideal for mobile payments. Additional readers are available for $25 each. Businesses can also purchase in-store credit card terminals starting at $149 each. Unlike Square, TSYS does not offer payment plans for hardware.
TSYS is a great card processor for businesses on the go. Cayan’s mobile features include:
- Free mobile card reader – TSYS comes with a free card reader for mobile payments.
- Offline payments – The card processor also accept payments offline.
TSYS also offers secure online card processing with their payment gateway. TSYS ecommerce features include:
- Secure payment gateway – TSYS offers a secure payment gateway for accepting online payments.
- Integration with popular ecommerce platforms – TSYS works with many popular ecommerce platforms, including Shopify, BigCommerce, and WooCommerce.
TSYS works with most top-rated POS systems and business management software, so business owners can use the software they like best. Unlike Square, TSYS is purely a payment processor and does not have POS functions. TSYS is designed to be used with another system.
What TSYS Is Missing
TSYS is a traditional merchant account provider. While that can be a better option for larger businesses, TSYS does not have the simplicity that an all-in-one system such as Square has. TSYS also does not have the simplicity of a flat-rate processor. Some business owners say Cayan’s other fees can be unexpected. While there is no early cancellation fee, TSYS does lock businesses into a contract. For competitive rates without a contract, consider Dharma.
Reviews for TSYS can be mixed, but generally skew positive. Most of the negative reviews revolve around unexpected fees. However, most reviews say that TSYS has great customer support. Businesses also like that TSYS is more flexible than a flat-rate processor. Visit our TSYS Review Page for more feedback from business owners.
Get Started with TSYS
TSYS is a great card processing company for businesses with high sales volumes because they can save money with lower processing fees. TSYS has a variety of solutions dedicated to small business owners. Contact TSYS for free cost comparisons and to receive a free estimate for your business.
Chase Merchant Services: Best Credit Card Processing for Businesses That Want to Work with a Traditional Bank
Chase Merchant Services (formerly Chase Paymentech) is part of JPMorgan Chase, one of the largest banks in the country. Chase is both the processor and receiving bank in a transaction, which can provide business owners piece of mind and allow business owners faster access to transaction funds. Overall, Chase is a good option for businesses that want to work with a traditional bank for their payment processing.
Chase Merchant Services Pricing
Chase Merchant Services pricing is entirely quote based. However, that means there will be some flexibility when it comes to payment structure and pricing. Chase offers both interchange-plus pricing and flat-rate pricing. We recommend opting for interchange-plus pricing if possible.
Chase Merchant Services Features
Chase Merchant Services is a direct processor, meaning there is no middleman between the merchant account and the bank. It’s a good alternative for businesses that don’t want to use a third party, and would rather work directly with a bank, especially if they already have a Chase Business account.
Additional Chase Merchant Services features include:
Chase Merchant Services Equipment
Chase offers business owners the option of buying payment terminals outright or renting them on a month-to-month basis. Their selection of terminals include EMV-compliant Verifone terminals. Businesses will have to contact Chase for specific pricing, as it is not publicly available.
Chase has a mobile checkout app that can be used with iOS and Android, and an eDynamo card reader that is EMV compliant. Chase Merchant Services sometimes includes the free mobile reader, so be sure to ask about that when negotiating plans and pricing.
For online sellers, Chase has a proprietary Orbital Payment Gateway. Chase also works with many other third-party gateways such as Authorize.net. So, Chase should work just fine with any major ecommerce platform or website.
Like TSYS and Dharma, Chase does not have any built-in POS functions (aside from the separate mobile checkout app), and is designed to be used with a POS system or other business management software. Chase Merchant Services can work with most popular and top-rated POS systems.
What Chase Merchant Services Is Missing
On the back-end, Chase Merchant Services is very streamlined. However, on the front-end, Chase is not an all-in-one system like Square, meaning businesses will have to navigate integrations and dealing with multiple customer service teams if something goes wrong.
Chase Merchant Services Reviews
Chase Merchant Services has excellent reviews, especially for such a large company. Overall, businesses like seaming with Chase and like the security that comes with using a bank as their payment processor.
Get Started with Chase Merchant Services
Chase Merchant Services is a great option for small businesses that want a streamlined, behind-the-scenes process with their payments and bank. Contact Chase directly for more specific pricing information.
Selecting a credit card processing company that you trust and are comfortable using is super important, as credit card transactions play such a big role in every business. Card transactions are likely the main source of your income, so it’s important to have a system that is easy to use, cost effective, and transparent.
Square is a great credit card processing company for small businesses because it offers a streamlined, all-in-one system that is easy for both business owners and customers to use. Overall, Square is a feature-rich platform that provides an excellent value for a low price. Plus, businesses just use what they pay for and are never locked into a contract. Visit Square today to set up your free account!