As a business owner, you’re not required to understand the ins and outs of credit card processing to be successful – few people outside of the world of banking and finance can make sense of the technical structure that makes up the payments chain. But it’s important to know what factors to consider when comparing the bevy of credit card processing services out there in the market.
Here we take a look at some of the industry’s more popular credit and debit card processors, and then we break down some of the key considerations to keep in mind when choosing a provider.
Our process
The payment processing providers included in this list were chosen based on an analysis of popular reviews combined with years of experience reporting on and writing about the payments space and its key players. Square is a merchant aggregator that sets customers up as submerchants under its master merchant account. In addition to processing credit cards on mobile devices, Square offers a bevy of software tools for running a business, along with e-commerce capabilities and merchant financing. Square’s software features include analytics, appointments, invoices, and team management. In addition to processing, Payline also offers software for invoicing, recurring billing, and ACH payments, and integrates with most POS systems, shopping carts, and accounting services like Quickbooks. For in-person payments, QuickBooks charges 2.4% plus 25 cents per transaction. Invoiced payments cost 2.9% plus 25 cents per transaction fee, and manually keyed payments cost 3.4% plus 25 cents per transaction. Unlike Square, which sets users up under its master merchant account, QuickBooks requires merchants to have their own merchant accounts for credit card processing. For in-person card acceptance, PayPal offers Here, a mobile credit card processing and point-of-sale system. In addition to credit card processing, PayPal offers robust customer service and merchant support and a streamlined financing program for merchants. For business services, PayPal integrates with software providers including BigCommerce, Shopify, and QuickBooks. For businesses that process $0 to $25,000 in volume per month, in-person payments accepted using a card reader cost 0.30% plus 8 cents, while keyed or online transactions cost 0.50% plus 25 cents above interchange, per transaction. Businesses with monthly volume between $25,001 to $50,000 per month are charged 0.25% plus 7 cents for in-person payments, and 0.45% plus 20 cents for keyed or online transactions. For businesses with $100,001 to $250,000 in volume per month, the rates drop to 0.18% plus 6 cents for in-person, and 0.35% plus 15 cents for keyed or online. Helcim does not place its customers under a master merchant account and instead provides customers with individual merchant accounts under which they can accept all major credit and debit cards. Helcim also includes Helcim Commerce, its all-in-one merchant platform, for free with every processing account. Adyen’s technology connects directly to Visa, MasterCard, and a range of other payment methods across online, mobile, and in-store environments. In addition to processing, Adyen offers virtual terminal and payment gateway services, along with a point of sale solution, integrated online checkout, and tools for risk and optimization. Stripe’s APIs allow businesses to customize their payments experience, making it ideal for subscription services, marketplaces, e-commerce stores, and B2B platforms. In addition to processing, Stripe also offers a range of software add-ons, including the Stripe Dashboard, Stripe Terminal, Stripe Checkout, Stripe Billing, and Stripe Connect. Instead, the company uses the cost-plus pricing model, along with a flat monthly fee. Membership prices range from $79 plus interchange for the starter processing package to $199 plus interchange for the enterprise-level package. It’s worth noting that this model is not ideal for small businesses, as it tends to favor bigger businesses with high processing volume and large transaction totals. In addition to debit and credit card processing, National Bankcard offers electronic check acceptance and compatibility with gift and loyalty programs. Its platform also integrates with QuickBooks for bookkeeping and financial management, and the company has a robust set of security and anti-fraud services. In terms of rates, GoDaddy charges 2.9% plus 30 cents above interchange, per transaction, with no monthly minimums. GoDaddy does not charge setup fees or require long-term contracts for payments processing. GoDaddy Payments integrates with Websites + Marketing and GoDaddy-powered Managed WordPress and WooCommerce sites. The integration lets customers manage orders, payments, and refunds, alongside other aspects of their online business, all from one dashboard. It’s also important to note that most processors, regardless of fee structure, distinguish between card-present (CP) and card-not-present (CNP) transactions. CNP transactions occur when a merchant keys in a credit card number by hand, and they are always more expensive because they carry an increased risk for fraud. Interoperability is an important factor for ease of use and reporting reasons, especially if you want to connect your processing network directly to your point of sale system. Some processors offer POS software that integrates natively into their system and hardware, while others build out a network of partners for merchants to choose from. It really boils down to the needs of your business and the complexity of your inventory when deciding what POS software to go with. Finally, it’s wise to look for a processor that offers customer support 24 hours a day, 7 days a week, preferably with direct help from an account representative.
