Merchant services allow businesses to accept credit and debit card transactions in-person or online. Many merchant service providers also offer payment processing tools such as payment gateways, point-of-sale (POS) systems, and card-reading hardware. We evaluated dozens of popular providers to identify the best merchant services for small businesses.
Best Merchant Services for Small Businesses
Best overall with instant sign-up and transparent fees
Wholesale processing fees for established businesses
Growing businesses using invoicing or recurring billing
Established retailers and restaurants
User-friendly mobile app for occasional sales
Any business having trouble getting approved
Interchange-plus merchant services for online sales
Businesses wanting a merchant account through a bank
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Square: Best Overall Merchant Services
Square is an all-in-one merchant services provider, meaning it can process payments in-store, via mobile, online, virtual terminal, and even invoice payments. Square is the simplest merchant account provider to get started with, is free to use except for transaction fees, and offers the best value for new and small businesses.
Transparent and predictable pricing
Not suitable for high-risk businesses
Free, user-friendly software
Account stability issues
No application, contract, monthly fees, or minimum requirements
No ACH payment processing
Square operates using flat-rate credit card processing fees that are transparent and predictable. The only fees you pay to Square are for credit card processing, and that amount depends on how the sale was made: in-person, online, or using the virtual terminal.
Square Processing Fees
- In-store and mobile card payments: 2.6% + 10 cents*
- Keyed-in and stored card payments: 3.5% + 15 cents
- Online payments: 2.9% + 30 cents
- Invoice payments: 2.9% + 30 cents
*Discounts available with paid software plans and for high-volume merchants
Square Hardware Costs
- Swipe card reader: Free for new Square accounts ($10 for additional)
- Chip and tap card reader: $49
- Square Terminal: $299 or $27 per month for 12 months
- Square iPad stand for contactless and chip: $169 or $16 per month for 12 months
- Square Register: $799 or $39 per month for 24 months
As soon as you create your free Square account, you can accept credit card payments, record cash and check sales, process invoices, set up an online checkout or ordering system, and accept contactless payments. The real benefit of choosing Square as your merchant service provider is Square’s full suite of business management tools included in your free Square POS software.
- Payment types: All major credit and debit cards, contactless and e-wallet payments like Apple Pay and Google Pay; can create and send individual or recurring invoices.
- Mobile app: Free mobile app that can accept payments even offline, tipping features.
- Deposits: Receive funds within one to two business days, or instantly for 1% fee.
- Customer management: Send digital receipts with email and text options, built-in automated customer directory, can collect and respond to customer feedback.
- Integrations: Integrates with most major ecommerce platforms and many POS systems; can build a free website or checkout with Square Online Store, add marketing, payroll, and customer loyalty add-ons.
Payment Depot: Best Merchant Services for Established Businesses
Payment Depot is a merchant service provider with a membership pricing model that provides payment processing at extremely competitive rates. One membership with Payment Depot includes interchange-plus pricing for in-person, online, virtual terminal, and mobile payments. This flexible model with affordable pricing makes Payment Depot one of the cheapest credit card processors for small established businesses including retailers, restaurants, salons, auto shops, medical practices, and business-to-business (B2B) companies.
Payment Depot Strengths
Payment Depot Weaknesses
Payment Depot Weaknesses
Not compatible with high-risk businesses, including CBD
No contract or cancellation fee
Best for businesses processing more than $10,000 monthly
24/7 customer support
Payment Depot Pricing
Unlike most credit card processing companies, Payment Depot makes no distinction between online and in-person payments. The pricing is the same, and both kinds of payments are included with every membership. There are no contracts or cancellation fees, and chargebacks and risk-monitoring are included. Free terminals are included with some plans; all plans offer to reprogram your existing equipment.
Payment Depot Pricing Plans
Transaction fee (+ interchange)
Monthly processing limit
Payment Depot Features
- Payment types: All major debit cards including Visa, MasterCard, Visa, American Express, and contactless payments including Apple Pay and Google Pay.
- Deposits: Next-day funding.
- Integrations: Lots of POS systems and ecommerce platforms including Shopify, Revel, QuickBooks, PrestaShop, BigCommerce, WooCommerce, Magento, and more. For online payments, Payment Depot integrates with Authorize.net and comes with a free virtual terminal.
Fattmerchant: Best Merchant Services for Professional Services
Fattmerchant is a merchant service provider with a subscription or membership model where businesses pay a higher monthly fee and low transaction fees. Fattmerchant offers user-friendly software called Omni that includes invoicing, recurring payment tools, and reporting features.
Omni software and the membership pricing model make Fattmerchant an ideal option for established or higher-volume businesses that process payments via invoice or subscriptions like healthcare and wellness companies, field services like construction, and professional services like lawyers offices.
High monthly fee
Omni software and integrated payments
Separate subscriptions for online and in-person sales
Fattmerchant charges a high monthly fee per sales channel―in-person and online, so it’s best for higher-volume businesses (around $20,000+ monthly) that will offset the monthly subscription fee. However, once you reach that threshold, Fattmerchant offers an excellent value with interchange-plus pricing and very low flat-rate transaction fees.
Fattmerchant Pricing Plans
Annual processing limit
Card-present transaction fee
Interchange + 8 cents
Interchange + 6 cents
Card-not-present transaction fee
Interchange + 15 cents
Interchange + 12 cents
ACH transaction fee
*Custom pricing available for businesses processing over $5 million annually.
- Payment types: All major credit and debit cards, ACH payments, invoicing, Text2Pay, virtual terminal, and contactless payments.
- Deposits: Same-day funding available.
- Omni: Omni includes financial reports and analysis, sales trends, deposit management, customer management, user and permission setting, two-way customer communication, and online review management.
- Mobile and contactless payments: Free iOS and Android mobile POS app, Bluetooth card readers; can use your mobile phone or tablet camera to scan credit cards for payment, manage invoices, track products, create catalogs, accept tips, scan bar codes, and send digital receipts.
- Online payments: Customized invoicing, auto-send invoicing, recurring billing, Text2Pay links, hosted shopping carts, one-click ordering.
- Integrations: Zapier, Shopify, Magento, BigCommerce, WooCommerce, Authorize.net, and a developer API. Fattmerchant also has two-way instant sync with QuickBooks Online.
At the time of publication, Fattmerchant has an average 5-star rating from over 30 user reviews.
Dharma: Best Merchant Service for Established Retailers and Restaurants
Dharma is a traditional merchant services provider offering interchange plus credit card processing services for storefronts, restaurants, and B2B sales. It is one of the most affordable and transparent options, however, Dharma has a $10,000 monthly minimum and a more selective application process, so it is best for established businesses.
Low-cost processing w/ no-contract
Higher fee for American Express cards
Free MX Merchant account
$25 account closure fee
- Restaurant and storefront rates: $20 per month plus a transaction fee of 0.15% + 7 cents plus interchange. Chargebacks are $25 per instance. American Express cards have a higher transaction fee of 0.25% + 7 cents per transaction.
- Virtual rates: $20 monthly fee plus a transaction rate of 0.2% + 10 cents plus interchange. American Express cards have a higher transaction fee of 0.3% + 10 cents per transaction.
- High volume rates: If you process over $100,000 monthly, your transaction fee decreases to 0.1% + 5 cents plus interchange.
- Hardware: Dharma offers several terminals from First Data, Clover, Verifone, and Ingenico that range from $95 – $649.
- ACH processing: ACH and check processing available through MX Merchant, Clover, and Sage including recurring billing options. Prices vary for each plan but generally include an additional monthly fee of around $20 plus 40 cents per transaction.
- Payment types: All major credit and debit cards, ACH and e-check payments, and mobile payments.
- MX Merchant: All Dharma accounts come with a free MX Merchant account that includes a virtual terminal, online reporting, and Apple and Android mobile processing app, online payment links, a customer database including options to save payment methods.
- Deposits: Next-day funding for card-present transactions.
PayPal: Best Payment Processing for Occasional Sales
PayPal is a household name offering user-friendly payment processing for online, mobile, and in-store sales. PayPal offers competitive flat-rate fees and is quick and easy to sign up for. Plus, adding PayPal as a payment option can increase online store conversions and reduce cart abandonment because shoppers don’t need to type in payment or shipping information.
However, PayPal is not a traditional merchant account, which means business accounts can be flagged and frozen if the company deems anything suspicious, which is problematic for businesses relying on daily deposits. So, PayPal is a top-recommended option for low-volume and occasional sales, or as an additional payment option for online stores.
Accept international payments; easy to use
Account stability issues
No monthly fees
Not suitable for high-volume businesses
Accept international payments
- Card-present transaction fee: 2.7%
- Online and invoice transaction fee: 2.9% + 30 cents
- Keyed-in transaction fee: 3.5% + 15 cents
- International fee: 1.5% (in addition to regular transaction fee)
- Card readers: Chip and swipe readers available for 24.99. Chip and tap readers $59.99 or $79.99 with stand.
- Payment types: All major credit and debit cards, plus PayPal, Venmo, and PayPal Credit. Send and manage invoices, subscriptions, and recurring billing, and set up payment links to sell on social media. Set up simple checkout pages or add “Buy” buttons to any website.
- PayPal Here: This free mobile app lets you accept credit, debit, and PayPal payments from any smartphone or tablet. It also has basic POS features like customer data tracking, customized receipts, as well as options to add return policies, manage inventory, upload product photos, add up to 1,000 users with different access levels, and view custom sales reports.
- QR code payments: PayPal has QR codes you can use for touch-free payments. Customers scan the code with their smartphone and pay in the PayPal app—no card reader or POS software required.
- Deposit times: Almost instantly into your PayPal account; up to a few business days to transfer into your bank account ACH and e-check payments take longer.
PaymentCloud: Best High-Risk Merchant Account
PaymentCloud is a popular merchant service provider that specializes in high-risk accounts. If you are a high-risk business, for the type of products or services you sell, or because of poor credit, PaymentCloud could be a good fit, even if you have been turned down by other merchant account providers.
PaymentCloud has a “hard-to-place” program that includes relationships with over 10 banks, and a step-by-step application process where they help you submit all the documents needed to get approved by one of their partner banks.
PaymentCloud does offer traditional merchant services in addition to high-risk accounts. However, high-risk payment processing is what PaymentCloud is best known for. Many other merchant service providers, including Dharma, refer high-risk businesses to PaymentCloud.
Excellent high-risk placements
Supports limited CBD products
Excellent customer support
Pricing not disclosed
PaymentCloud does not have any publicly disclosed pricing, which is common for high-risk merchant account providers. The rates you receive will depend on your individual business and what can be negotiated with one of PaymentCloud’s partner banks.
PaymentCloud has no application fees, setup fees, or annual fees. Monthly fees and minimums will be determined when you open an account. Generally speaking, high-risk payment processing is more expensive, requires more extensive applications and on-boarding, and can come with more restrictions than traditional merchant accounts.
- Payment types: All major credit and debit cards and ACH payments. PaymentCloud works with virtual terminals, payment gateways, online shopping carts, terminals, and POS systems.
- High-risk businesses: PaymentCloud works with the following business types that may require a high-risk account: select CBD products, accounting and tax prep, firearms, tobacco and smoking accessories, tech support, credit repair, digital downloads, document prep, dropshipping, SEO services, nutraceuticals and supplements, property management, SaaS companies, self-defense equipment, hunting, and outdoor.
- Integrations: Shopify, Weebly, Wix, Magento, BigCommerce, WordPress, WooCommerce, and more.
Helcim: Best Interchange-Plus Merchant Account for Online Sales
Helcim is an all-in-one merchant account provider that also has sophisticated online sales solutions. Competitive interchange-plus pricing, along with ecommerce tools make Helcim a great choice for established businesses, especially those that want to sell online.
No contracts or early termination fees
Limited third-party integrations
Free POS, invoicing, and online store software
Not suitable for high-risk businesses
International payment processing
Best for high-volume vendors
Helcim charges $20 per month, plus transaction fees with volume discounts. There are no contracts or cancellation fees. If you don’t process payments, your monthly fee is automatically waived. Chargebacks are $15, though if you win the dispute, Helcim will reimburse this fee.
Helcim Card Reader is available for $199 and can connect with desktop computers, tablets, and smartphones (via USB, Bluetooth, or Wi-Fi). It also syncs to the Helcim Payments App.
Helcim Pricing Tiers
Monthly Processing Volume
Manually Keyed and Online
$0 - $25,000
0.3% + 8 cents (+ interchange)
0.5% + 25 cents (+ interchange)
$25,001 - $50,000
0.25% + 7 cents (+ interchange)
0.45% + 20 cents (+ interchange)
$50,001 - $100,000
0.2% + 7 cents (+ interchange)
0.4% + 20 cents (+ interchange)
$100,001 - $250,000
0.18% + 6 cents (+ interchange)
0.35% + 15 cents (+ interchange)
- Payment types: All major credit and debit cards, UDB, Google Pay, Apple Pay, invoice payments, and online payments.
- Deposit times: One to two business days.
- Integrations: QuickBooks, Magento, WooCommerce, Ecwid, etc.
- Billing and invoicing: Free Helcim Virtual Terminal; can create and send custom invoices including saved product catalogs and customer management with automatic reminders for payments due; store customer payment information with Helcim Vault for recurring payments and subscriptions. A self-service portal lets customers log in to view and make payments and update contact or payment information.
- Retail and mobile payments: Helcim comes with free POS software for desktop and a payments app for accepting payments anywhere. Manage products and customer information, track sales and stock counts, send receipts, and access reports.
Chase Merchant Services: Best Merchant Account Through a Bank
Chase Merchant Services offers merchant services that are a great alternative for any business looking to work with a traditional bank, especially if your business accounts are with Chase. Having Chase as both the processor and receiving bank in transactions can provide speed and security by removing the middleman.
Chase is one of the largest processors in the US and one of the few direct processors that offer flat-rate fees for small businesses.
Chase Merchant Services Strengths
Chase Merchant Services Weaknesses
No publicly disclosed pricing
Next-day funding for Chase business checking customers
Some plans require long-term contracts
Chase Merchant Services Pricing
Chase does not publicly disclose merchant account rates and fees. However, based on information gathered from previous conversations with Chase and other online reviews, it offers flat-rate processing for small businesses and interchange-plus pricing upon request (and approval). Because Chase is a direct processor, there is more room to negotiate different rates and structures.
- Card-present transactions: 2.6% + 10 cents per transaction
- Online transactions: 2.9% + 25 cents per transaction
- Keyed-in payments: 3.5% + 10 cents per transaction
Chase also does not disclose hardware pricing but offers a range of card reader and terminal options. Some plans come with a free terminal but typically require a long-term contract. If you purchase the hardware outright or reprogram your existing equipment, month-to-month billing is available.
Chase Merchant Services Features
- Payment types: All major credit and debit cards, mobile wallet payments like Apple Pay, and virtual terminal payments.
- POS solutions: Chase Mobile Checkout app works with iOS and Android devices and a contactless card reader; You can set up a standalone terminal for in-store payments, or process transactions with a virtual terminal.
- Integrated solutions: Chase has integration partnerships and offers discounts or free trials with BigCommerce, FreshBooks, Joist, mHelpDesk, Agree.com, and Fusebill.
- Payment gateway: Chase has a proprietary Orbital Payment Gateway, and is also compatible with popular gateways like Authorize.net.
- Chase Online: Access all your Chase business accounts in one login.
Stripe: Best Payment Processing for Online Businesses
Stripe is a payment processor with sophisticated software and APIs ideal for online businesses and apps that want to create a custom checkout solution. Stripe’s pre-built integrations make it easy to connect a Stripe checkout to almost any website or software.
Stripe is an industry-leading payment solution used by startups and Fortune 500 companies, and while they serve businesses of all sizes, you’ll get the most value out of Stripe if you have developer resources to configure a custom checkout.
Grows with your business
Powerful, user-friendly APIs
Powerful, user-friendly APIs
Stripe has a pay-as-you-go pricing model with flat-rate transaction fees. There are no monthly fees and the transaction fees are the same for every card type.
- Online transaction fee: 2.9% + 30 cents
- In-person transaction fee: 2.7% + 5 cents
- International payments: Additional 1% per transaction
- ACH direct debit: 0.8% capped at $5 per transaction
- ACH credit: $1 per transaction
- Klarna: Stripe offers installment and pay-later payment options through Klarna. Fees range from 2.99% – 5.99% + 30 cents per transaction.
- Payment types: Accept all major credit and debit cards in over 135 currencies, ACH payments, WeChat Pay, Apple Pay, Google Pay, Microsoft Pay, Klarna, and pre-authorized debits.
- Deposit times: Two business days (seven to 14 days for initial payout after account setup), instant deposits available for a 1% fee.
- Card account updater: Automatically update expired or renewed card information for customers that have payment methods saved on file.
- Integrations: WordPress, Magento, Squarespace, Wave, 3dcart, Survey Monkey, Zoho, Xero, Big Cartel POS, etc.
- Subscriptions and recurring billing: Collect one-time or recurring payments with a flexible billing logic that can accommodate different checkout needs like per-seat pricing, metered billing, coupons, free trials, pro-rates, overages, usage-based and more. Create these systems from Stripe Dashboard—no coding required.
Merchant Service Provider Frequently Asked Questions
Choosing the right merchant service provider for your business is an important choice, and unfortunately, the payment processing industry is not known for transparency.
What is a merchant service company?
A merchant service company is a financial service provider. They are used by businesses to accept credit or debit card payments through a point-of-sale system, website, or online ordering system.
What are the different types of merchant service accounts?
There are many different types of merchant accounts and payment processing solutions. The most common options for small businesses are aggregators and independent sales organizations (ISOs). Larger businesses like chain stores are more likely to use direct processors. The only direct processor we included in our list is Chase Merchant Services, because it has programs geared toward small businesses and could be a good fit for those already using Chase for business checking, credit, or savings accounts.
Aggregators, such as Square, serve as a kind of middleman between the business and the bank or card associations. Aggregators are typically user-friendly and don’t require an application or processing minimums. The percentage fees are typically higher than a direct processor, but still, make the most financial sense for small or startup businesses. They also typically have software such as POS systems or invoicing tools that are used along with the payment processing service.
ISOs like Payment Depot, provide the services of a direct processor but under a different brand name. For example, Payment Depot is an ISO of Wells Fargo. ISOs typically require an application process but offer the most economical pricing for established SMBs. For small businesses, ISOs are a better option than direct processors because they can offer lower rates and more user-friendly software features.
What are the different kinds of transaction fees?
These four merchant service provider structures include:
- Flat rate: With flat-fee merchant service providers, you pay a flat percentage rate based on the type of charge like in-store, online, and mobile that you’re processing. Flat-rate merchant account providers have the simplest fee structure and tend to be quick and easy to set up. A flat fee is the best merchant services option for startups, independent shops, and low-volume of less than $30,000 per month sellers.
- Interchange-plus: The Interchange Rate is the actual fee that credit card issuers, such as Visa or Mastercard, charge merchant account providers each time a card is processed. Interchange-plus providers add their fee on top of the card issuers’ Interchange Rates. Interchange-plus tends to be the best merchant service options for higher-volume sellers processing more than $20,000 per month.
- Tiered rates: Some merchant service providers create a tiered structure of usually three to six tiers that group several card types into separate rate tiers. This typically isn’t the best merchant services fee structure for small businesses because it is unpredictable. Also, most payment cards typically fall under the most expensive tiers. However, for some, like a business processing strictly business-to-business (B2B) sales, a tiered structure can save on fees.
- Direct interchange: This type of merchant service provider charges a hefty monthly fee but passes the interchange rate directly to you without a percentage markup. This isn’t the best merchant services provider for low-volume sales since you pay a large monthly fee regardless of volume. However, volume sellers of $20,000 per month or more can save with this option.
How do I choose a merchant service provider?
Price and ease of use are the two most important factors. Always compare rates, and do the math for yourself, even though most providers will offer quotes. Then, consider how the payment processing tools will integrate with your other software systems. Read user reviews to spot any consistent complaints. Finally, make sure there’s phone tech support that works aligns your business hours.
Choosing the right merchant account provider can save your business lots of money in fees each month. The best payment processors are also easy to use, offer a good value with business solutions, and integrate with popular software. Plus, merchant accounts should be transparent and reliable.
If you’re launching a new venture or have sales volumes of less than $20,000 per month, you can’t go wrong with Square. Its all-in-one simplicity, low flat-rates, and free POS business management tools make it practically unbeatable for most small business needs. Visit Square to create a free account.