Which Credit Card Processor Is Cheapest for Small Business in 2019

credit card processing for small businessesWhen it comes analyzing credit card processing services, it's vital to find the most reliable and affordable company fit for your small business. Consider these things.

A 2017 study found that 77 percent of customers preferred to pay with their debit or credit cards instead of using cash.

Allowing credit card purchases as a business can expand your customer base and increase your revenue. However, accepting credit cards isn’t free. Processing credit card transactions incur a fee, with the size of that fee depending on the size of the sale, the type of card, and of course, which processor your business works with.

For credit card processing for small businesses, the processors to focus on are the ones that do not have regular or monthly fees. Look for flat rate charge or percentage per transaction. However, your business should not go with the lowest rate offered. While you can compare the rates, you should also examine the other features that each processor offers.

Knowing the different credit card processing options that are available to your market, and how their fee structure differs from one another, can help you choose the cheapest option. By saving even a small amount of money on each credit card sale, you can have a sizable impact on your business’ bottom line.

PayPal LogoPayPal

PayPal reviewed well. PayPal offers a chip and swipe reader, as well as an app, that allows your business to process payments in-store. As an online payment service, they also allow you to accept payments on your website or through your app.

The main advantage of PayPal over other processors is their virtual terminal. By logging into your PayPal account, you can turn any phone or computer into a payment processing terminal, without any special hardware. The virtual terminal charges a 3.1% fee, plus $0.30, on every transaction.

In-person sales that you complete using the PayPal app or one of their card readers have a flat 2.7% fee. Online sales come with a 2.9% plus $0.30 fee, and manually entering the credit card comes with a 3.5% plus $0.15 fee.

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Flint LogoFlint

Flint’s payment processing software lets you accept payments using an app on your phone. Instead of swiping cards, your camera will scan the card’s information and process the payment. You can also send invoices from the app, and set up online payments on your website.

Flint charges a flat 2.9% plus $0.30 fee on each transaction and comes in three different plans. The free plan allows you to process an unlimited amount of payments but limits your invoicing and client directory features – which the paid plans expand on.

In order to sell online, you must pay for a premium subscription, which is either $99.99 or $149.99 a year.

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Square Up logoSquare

Square offers some of the best rates small business can find. offers physical hardware that you can start using immediately to start accepting credit cards. There is a standalone unit that can accept credit cards by tap, swipe or chip, and iPad and smartphone add-ons that can turn your devices into a complete terminal. Dedicated proprietary registers and terminals are also available,

Square charges 2.75% for most swiped, tapped, or inserted credit cards, and 3.5% and $0.15 if you manually enter the credit card number yourself. However, if you buy one of Square’s registers or terminals instead of the mobile and tablet add-ons, the fees are lower, at 2.5% and $0.10 for the register, and 2.6% and $0.10 if you use a terminal.

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Stripe LogoStripe

Stripe is a really good fit if your business only deals with online sales. It does not support in-person transactions, nor does it offer physical terminals that you can process payments through. Stripe charges on a per-transaction basis, with 2.9% of the sale on top of a $0.30 base fee for each purchase that it processes.

On a basic level, you can simply copy and paste code to have a checkout page set up on your website in minutes. However, the main advantage of Stripe over other types of online credit card processors is that Stripe provides an API that you can use to customize your checkout process. If you have coding experience or a website developer on staff, you can change the appearance of stripe and make it integrate seamlessly with your app or website.

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If your business is already using QuickBooks for its accounting needs, you should consider using their processing service. By using both pieces of software, your accounting books update as your payments come in.

There is a two-tiered fee structure. Using the option without monthly fees charges 2.4% plus $0.30 for a swiped card and 3.5% plus $0.30 for payments completed online or punched in manually. The $20 a month option charges 1.6% plus $0.30 for swiped payments, and 3.3% plus $0.30 for online and punched in payments. This is a better option for small businesses with higher volumes or average sale prices.

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Payment Depot logoPayments Depot

Payments Depot is a little different from the above credit card processors in that it charges a monthly fee. There are multiple tiers, designed for different volumes of sales, and each carries a different set of benefits.

For example, the lowest tier costs $49 a month, but each transaction will only cost a flat rate of $0.15. Your business can handle up to $25,000 in sales each month. Other tiers will drop the rate, with the highest tier costing $199 a month but charging only $0.05 per transaction (and it comes with free payment terminals).

Payments Depot is ideal for smaller businesses looking to scale up the size of the operation in the future, but which currently have a relatively constant sales volume. The lower per transaction fee will ultimately save you money compared to processors that take a percentage if you’re selling enough each month.

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Compare More Options for Credit Card Processing for Small Businesses

Keep in mind that you are not locked into using a single payment processor forever. It's a good idea to constantly review the different fee structures and other features that each processor offers as the needs and size of your business change.

While PayPal may be a great idea when you are just starting out, switching over to Payments Depot once you have a physical retail location and a higher volume of sales can save you money.

If you still have questions about credit card processing for small businesses and want to compare other options against the ones outlined here, you can check out this guide on the best credit card processors for both online and physical businesses.

Author: Hudson Piccini

Hudson Cynar, a Harvard University alumna and the owner of three prosperous enterprises, is a distinguished business consultant, author, and writer. Her expertise spans multiple business sectors, with a particular emphasis on storage containers, commercial copiers, payroll services, and medical billing software. Dedicatedly investing thousands of hours into product and service research, Hudson crafts insightful reviews to guide entrepreneurs in making informed decisions for their businesses.