Free credit card processing, also known as “zero-fee” or “zero-cost” processing, refers to the process of passing some or all of the fees associated with payment processing along to your customers, so your business is essentially paying nothing to process credit card payments.
While this expense-cutting strategy was unpopular in the past because it places a burden on customers, the rising cost of accepting credit card payments is making merchants reevaluate. Merchant processors have also improved their service to offer compliant free credit card processing programs.
The following are the top free credit card processing merchant processors:
- Helcim: Best for invoicing
- CardX: Best for compliance
- Dharma Merchant Services: Best for B2B and large-volume businesses
- eHopper: Best for businesses that also need point of sale (POS)
- PaymentCloud: Best for high-risk merchants
- Free Credit Card Processing Solutions Compared
- Types of Free Credit Card Processing
- Helcim: Best Zero-cost Processing Program for Invoicing
- CardX: Best for Free Credit Card Processing Compliance
- Dharma Merchant Services: Best for B2B & Large-volume Businesses
- eHopper: Best for Businesses That Also Need a POS
- PaymentCloud: Best for High-risk Merchants
- How We Evaluated Free Credit Card Processing Solutions
- Where Is Cash Discounting & Credit Surcharging Legal?
- What to Look for in a Zero-cost Credit Card Processing Program
- Free Credit Card Processing Frequently Asked Questions (FAQs)
- Bottom Line
Free Credit Card Processing Solutions Compared
| Monthly Fee | Free Credit Card Program | Non-Credit Card Payment Method | |
|---|---|---|---|
 | $0 | Credit SurchargingCash Discounting | ACH |
| Visit Helcim | |||
 | From $29 | Credit Surcharging | Debit Card |
| Visit CardX | |||
 | $25 | Credit SurchargingCash DiscountingConvenience Fee | Debit CardACH |
| Visit Dharma Merchant Services | |||
 | $0 | Credit SurchargingCash Discounting | Debit Card |
| Visit eHopper | |||
 | From $10 | Credit SurchargingCash Discounting | Debit Card |
| Visit PaymentCloud | |||
Types of Free Credit Card Processing
Businesses can pass costs along in three ways:
1. Cash Discounting
This is when the merchant offers a discounted price for customers paying in cash. You see this often at gas stations, which might charge a higher per-gallon price for credit card payments than cash purchases. Read our guide to cash discounting.
2. Convenience Fee
This is when merchants add a fee at checkout for customers wanting to purchase items remotely with a credit card. The convenience fee is usually a fixed amount, regardless of the transaction amount and the products the customer purchases.
3. Credit Surcharging
This is when the merchant passes the credit card payment processing fees onto the customer by adding them to the transaction cost. However, many merchant account providers and payment processors have policies against this. Merchants are expected to post signages in their physical or online stores to let customers know of their surcharge policy. Most surcharge fees amount to less than 5% of the total transaction. Read our guide to credit surcharging.
Helcim: Best Zero-cost Processing Program for Invoicing
Overview
Helcim offers a zero-cost payment processing solution called Helcim Fee Saver. It is unique in such a way that the system automatically detects the type of free credit card processing program to use for each transaction based on the business location and the card brand being used. Every Helcim merchant that also uses Helcim’s ACH payment processing service gets access to the Fee Saver with a toggle switch to set zero-cost payment processing on or off for every transaction.
However, the Helcim Fee Saver works in-person with the Smart Terminal. It also does not process debit card transactions—only ACH, as an alternative to credit card payments. Learn more about ACH payment processing.
Helcim Pricing
- Monthly account fee: $0
- Domestic ACH fee: 0.5% + 25 cents, capped at $6/transaction
- ACH return fee: $5
- Credit card reader: $99 (mobile reader), $349 (standalone POS terminal)
- Standard credit card processing fees:
- Card-present fee: Interchange plus 0.15% + 6 cents to 0.4% + 8 cents
- Card-not-present fee: Interchange plus 0.15% + 15 cents to 0.50% + 25 cents
- American Express transactions: 0.10% + 10 cents
Helcim Features
- Recurring billing and invoicing: Helcim offers advanced tools to create, send, and track customer billing and invoices. It comes with a product catalog that allows you to customize invoices with product line items, and even add free trials for subscriptions.
- Customer portal: Part of Helcim’s customer and subscription management feature is the customer portal that allows you to provide your customers with the option to sign up for an account and manage their own payment details.
- Fraud management: The Helcim merchant portal comes with the Fraud Defender. This program estimates transaction risk based on factors such as IP address, shipping and billing location, and card security code.
- Dispute resolution: Helcim also provides a dispute resolution management feature that helps merchants respond and track chargeback claims directly from the merchant portal.
CardX: Best for Free Credit Card Processing Compliance
Overview
CardX stands out as the best free credit card processing solution in terms of compliance and automated surcharging. In fact, it is this provider’s leadership in surcharging compliance that made Mastercard choose CardX as its official surcharging partner. CardX works continuously with state lawmakers to make sure that the system’s features are always up-to-date with regulations on credit card surcharging. CardX offers a full-service surcharging setup—including pre-programmed card terminals, fully compliant disclosures, and merchant training.
We love CardX’s online payment processing features. However, CardX does not have a product catalog function, nor does it support invoice and billing customizations, so you won’t be able to add line items and view the invoice before you send them out. Its card terminals also do not support any POS integration.
CardX Pricing
- Monthly fee: From $29 for $0–$120K sales volume
- Debit card transaction fee: From 2.91% for virtual terminal transactions
- Card terminal: From $29/month
CardX Features
- Automated surcharging: The CardX payment technology is designed to automatically detect the type of card being used for the transaction and know when to apply (or not apply) a surcharge.
- Virtual terminal: The CardX merchant portal comes with a virtual terminal that allows you to accept one-time payments over the phone, via email, or through live messaging services.
- Online checkout: Lightbox is CardX’s secure online checkout solution. It can be customized and added to your website or sent directly to your customers as a payment link. Apart from CardX’s automated surcharging technology, Lightbox also comes with Mastercard’s click-to-pay checkout functionality.
- Reporting: CardX reporting is a feature-rich functionality that allows you to track all sales transactions and batch settlements. It can be filtered and customized based on a range of categories including locations (for merchants with multiple establishments). The reporting functionality is connected to the CardX customer directory to add and edit customer information.
Dharma Merchant Services: Best for B2B & Large-volume Businesses
Overview
Dharma Merchant Services is a traditional merchant account services provider that offers free credit card processing through the MX Merchant payment gateway called MX Advantage. It comes with built-in customer management, online reporting, mobile processing, virtual terminal, and online checkout links. And because it operates within the MX Merchant ecosystem, Dharma allows merchants to apply free credit card processing to nearly all types of payment methods including invoicing and level 2 and 3 data processing (used for government and B2B purchases).
Unlike CardX, Dharma merchants will have to purchase the expensive card terminals outright. And while it provides the most free credit card processing payment method in our list, there are additional monthly fees for accessing some MX Merchant software for other payment types.
Dharma Pricing
- MX Advantage monthly fee: $25
- Additional MX Merchant tools monthly fees:
- B2B Processing App: $20
- Invoicing App: $10
- Merchant Insights App: $10
- ACH Processing: $25
- E Tab Online Ordering: $49
- Hardware: $295 Dejavoo Z11
Dharma Features
- Customer management: Dharma’s customer management feature offers advanced customization tools that allows merchants to capture an unlimited number of customer records, save multiple payment details, track transaction history, and add custom fields such as customer preferences and spend profiles.
- B2B payments: The MX B2B app can be configured with a free credit card processing program. It comes with a virtual terminal that automatically fills in the required additional information to process level to and level 3 payments.
- POS integrations: Dharma works with TSYS and First Data (Fiserv) networks that primarily offer Clover. However, Dharma is also compatible with other POS systems for various industries such as Lavu, NCR Silver, Aloha, and Micros. It can also work with Shopify, Revel, and Talech with the help of payment gateway integrations.
- Reporting: The MX Merchant platform comes with built-in reporting capabilities that allow you to customize and filter data based on date, Merchant ID, transaction status, and more. The report displays the surcharge fee (if any) in a separate column on the payment grid.
eHopper: Best for Businesses That Also Need a POS
Overview
eHopper is a point-of-sale (POS) system provider that comes with an integrated third-party payment processing feature. It works with traditional merchant services providers such as TSYS, First Data, and Elavon that support most merchant processors offering zero-cost credit card processing programs. What makes eHopper stand out from other providers in our list is that it offers free POS, an ecommerce website, and even integrated card payment terminals to its merchants.
While eHopper states that it offers both credit surcharging and cash discounting, there is not a lot of information available about it on its website. Unlike CardX and Helcim, eHopper does not provide any details as to the automation and compliance tools in place for implementing these free credit card processing programs.
eHopper Pricing
- Monthly fee: From $0 to $39.99
- Standard credit card fees: depends on the merchant processor
- Godaddy Payments
- Nuvei
- Evo Payments International
- TSYS
- First Data
- Elavon
- Global
- North American Bank
- Hardware: Free Pax S300 (worth $299)
eHopper Features
- Free POS software and hardware: One advantage of eHopper over Helcim and CardX is that it offers fully integrated POS software and hardware. This means that there is a unified reporting feature so merchants do not need to manually reconcile credit card transactions against sales recorded in the POS.
- Multiple integrated merchant processors: eHopper is primarily a POS software provider, but it did well in providing multiple integrated third-party merchant processors. This flexibility even allows eHopper to offer its POS system to some high-risk merchant account types.
- Ecommerce: eHopper comes with a built-in website builder that allows merchants to create their own integrated, cloud-based online store. It also gives merchants access to popular online payment gateways such as Stripe, Authorize.net, and PayPal.
- Omnichannel reporting: eHopper’s integrated in-person and online payments and POS software comes with omnichannel reporting features. This means merchants get real-time data on overall sales, inventory, customer information, and transaction history.
PaymentCloud: Best for High-risk Merchants
Overview
PaymentCloud offers a host of payment solutions for all business types and is known for its dedicated onboarding merchant support with in-house merchant account experts. While it provides traditional merchant account services to all merchant types, PaymentCloud is particularly popular for its high-risk merchant account services. High-risk accounts also qualify for the provider’s free credit card processing programs.
PaymentCloud charges monthly fees to access payment gateway and virtual terminal platforms. And like eHopper, this provider does not go into the details of its automation and compliance features. However, with PaymentCloud’s reputation for excellent merchant support, we expect nothing less than providing every assistance merchants need to establish full compliance.
PaymentCloud Pricing
- Monthly fee*:
- Merchant account: $10–$45
- Payment gateway: $15
- Virtual terminal: $15–$45
- Standard credit card processing rates*:
- Low-risk transaction fee: 2%–3.1%
- Ave. mid-risk transaction fee: 2.3%–3.4%
- Ave. high-risk transaction fee: 2.7%–4.3%
- Hardware: Varies, not disclosed
*Rates and fees provided by PaymentCloud
PaymentCloud Features
- High-risk merchant services: PaymentCloud is a popular high-risk merchant account services provider with 10+ banking partners and an extensive list of approved high-risk industries. It has in-house high-risk merchant account experts who assist business owners from application to setup.
- Payment gateway agnostic: PaymentCloud is compatible with most payment gateway service providers and can work in migrating merchants to a different payment gateway without experiencing any business downtime.
- Fraud protection: As a high-risk merchant account service provider, PaymentCloud comes with advanced fraud protection capabilities. It offers industry-standard fraud detection tools and can impose temporary payment processing halts on suspicious transactions.
- Chargeback protection: PaymentCloud comes with a direct integration with Chargeback Guru to provide merchants with chargeback management tools for detecting, responding, and tracking chargeback disputes.
How We Evaluated Free Credit Card Processing Solutions
We started with a dozen free credit card processing solutions offered by standalone merchant processors and popular traditional merchant account services providers. We then initiated a primary evaluation based on compliance where some lost points for unavailable or outdated information on free credit card processing on their website.
We then further evaluated each provider’s technology behind their free credit card processing program which includes automation, integration, and ease of use. Those with detailed documentation of how they implement their programs earned high marks, while premium points were awarded to processors that allowed us to hand-test their onboarding and payment processing tools. Finally, we scored for value for money and scalability essential for small businesses.
The five candidates above stood out and proved the best for key free credit card processing features and for specific payment types.
Where Is Cash Discounting & Credit Surcharging Legal?
There aren’t any significant laws or regulations against cash discounting. In the US, cash discounting is legal in all 50 states. The Dodd-Frank Wall Street Reform and Consumer Protection Act was passed in July 2010, and one of its stipulations allows merchants to provide incentives for all-cash customer payments.
Credit surcharging, however, is not legal in every state. This interactive map shows the statutes around credit surcharging per state. Set your mouse pointer on a specific state for details. Note that you will need to ensure that credit surcharging is legal in both your state and your customers’ state.
Free Credit Card Processing: Types, Legality & Solutions
Alabama
Surcharge not prohibited. “A legal licensed lending institution, a vendor making credit sales, any financial institution operating in Alabama or any individual may, if provided in the contract, charge and collect at the time of making a loan or credit sale, on each contract of loan or credit sale, an interest surcharge of not more than six percent of the part of the amount financed, which is not in excess of two thousand dollars ($2,000).” Source
Alaska
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Arizona
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Arkansas
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
California
Surcharge prohibited by law but limited. The US Court of Appeals, 9th Circuit declares law prohibiting credit card surcharges is a violation of merchants’ freedom of speech under the First Amendment
Colorado
Connecticut
Surcharge prohibited. “No seller may impose a surcharge on a buyer who elects to use any method of payment, including, but not limited to, cash, check, credit card or electronic means, in any sales transaction.” Source
Delaware
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
District of Columbia
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Florida
Surcharge prohibited by law but limited. The US Court of Appeals, 11th Circuit has reversed the district court ruling after finding that Florida’s law against surcharging violates businesses’ commercial speech rights, and is therefore unconstitutional. Source
Georgia
Surcharge not prohibited. “In addition to any other charges, interest, and fees permitted by law and subject to the terms and conditions of the debit card or credit card acceptance agreement, a lender or merchant may collect a nonrefundable convenience fee from any person electing to utilize an option of payment by electronic means.” Source
Hawaii
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Idaho
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Illinois
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Indiana
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Iowa
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Kansas
Surcharge prohibited by law but limited. “The US District Court of Kansas has declared that the state’s no-surcharge law is unconstitutional as it regulated speech and violated a payment processing company’s commercial speech rights.” Source
Kentucky
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Louisiana
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Maine
Surcharge limited to government agencies. “A seller in a sales transaction may not impose a surcharge on a cardholder who elects to use a credit card or debit card in lieu of payment by cash, check or similar means.” Source
Maryland
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Massachusetts
Surcharge prohibited. “No seller in any sales transaction may impose a surcharge on a cardholder who elects to use a credit card in lieu of payment by cash, check or similar means.” Source
Michigan
Surcharge not prohibited. “Although surcharging is now permitted by credit card merchant contracts, retailers must continue to abide by state laws that prohibit or restrict credit card surcharges. Michigan does not have any such law.“ Source
Minnesota
Surcharge not prohibited. “A seller of goods or services may impose a surcharge on a purchaser who elects to use a credit card in lieu of payment by cash, check, or similar means.” Source
Mississippi
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Missouri
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Montana
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Nebraska
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Nevada
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
New Hampshire
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
New Jersey
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
New Mexico
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
New York
North Carolina
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
North Dakota
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Ohio
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Oklahoma
Surcharge prohibited by law but limited. It is the Attorney General’s opinion that Oklahoma’s ban on surcharges for purchases using credit cards or debit cards does not “facially” violate the First Amendment unless interpreted by plain definition of surcharge as applied to the pricing schemes discussed in Italian Colors Restaurant v. Becerra, 878 F.3d 1165 (9th Cir. 2018) and Rowell v. Paxton, 336 F. SupP.3d 724 (W.D. Tex. 2018). Source
Oregon
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Pennsylvania
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Rhode Island
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
South Carolina
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
South Dakota
Surcharge not prohibited. “In 2013, a court settlement between retailers and the credit card industry resulted in merchants being able to pass their payment processing costs to consumers who pay with a credit card. In South Dakota, a merchant who chooses to exercise this surcharge, sometimes referred to as a ‘checkout fee,’ could increase your credit card purchase amount by as much as 4% (the maximum allowed).” Source
Tennessee
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Texas
Surcharge prohibited by law but limited. “In a sale of goods or services, a seller may not impose a surcharge on a buyer who uses a credit card for an extension of credit instead of cash, a check, or a similar means of payment.” Source
Utah
Surcharge is not prohibited by law but limited. “A consumer cannot meaningfully authorize the addition of a fee or surcharge unless the business first notifies the consumer in a clear and conspicuous manner about the fee or surcharge. Notification to a consumer after-the-fact, such as adding a line item on a receipt the consumer receives after payment, is not sufficient.” Source
Vermont
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Virginia
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Washington
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
West Virginia
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Wisconsin
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
Wyoming
Surcharge not prohibited. No state law has been enacted that prohibits surcharging.
What to Look for in a Zero-cost Credit Card Processing Program
As you can see, there is a growing number of payment processing companies that offer zero-fee payment processing, so it may become difficult to choose. You might overlook important features, pricing, and service agreement details that cause you to miss the best available terms or red flags before signing up for a contract.
When choosing a zero-fee payment processor:
- Make sure that it supports your chosen zero-cost processing method as not all options available offer both credit surcharging and cash discount programs.
- Confirm that the provider supports PCI-compliant payment terminals.
- Look for providers that automatically update their software with the latest state law compliance.
- Remember that depending on your chosen zero-cost processing method and business type, providers may offer month-to-month or long-term contracts and free or paid monthly fees.
- Research for customer feedback for each alternative on top of comparing terms and fees.
- Look for a payment processor that has chargeback management tools if you want to sign up for a credit surcharging program.
Watch out for zero-fee payment processors that:
- Require you to rent hardware, as this may result in long-term contracts and hefty early termination fees.
- Do not support automatic computation of surcharge fees built into its software.
- Do not provide traditional credit card processing methods as this might cause you to shift to a different provider if you no longer wish to use a zero-fee payment processing method.
- Offer tiered-pricing transaction fees for traditional payment methods as not all customers will opt for credit card or cash transactions.
- Impose high monthly fees (or do not offer custom pricing based on volume), minimum monthly transactions, or fees for not meeting minimum monthly transaction volumes.
Free Credit Card Processing Frequently Asked Questions (FAQs)
Expand the sections below to learn more about common zero-cost credit card processing concerns.
Should I use “No-cost” processing in my business?
Generally speaking, we don’t recommend small businesses use “zero-fee” or “no-cost” payment processing strategies because of the poor customer experience it creates. However, you want to account for processing costs in your overall business pricing strategy.
What’s the difference between credit surcharging and cash discounting?
The advantage of cash discounts is that it minimizes your merchant account fees and risk of chargebacks. On the other hand, credit card surcharging allows you to recover your merchant account fees by passing it on to your customers. Credit surcharging is also subject to card network (Visa and Mastercard) compliance.
What is the cheapest way to take card payments?
While there is no way to avoid credit card processing fees, choosing a low-cost merchant service provider like Helcim or Payment Depot can save you hundreds of dollars or more per month. Check out our lists of the cheapest credit card processing companies and best free merchant accounts to find the cheapest option for you.
Bottom Line
Unfortunately, there’s no such thing as truly free credit card processing. Card networks and issuing banks will always charge for their services with nonnegotiable rates that are only getting higher. If switching to a cheaper credit card processing company still does not make your business more sustainable, consider a zero-cost credit card processing merchant processor that offers strict zero-cost program compliance and automation.
