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Cash is no longer the king in the modern era of digital transactions. According to a recent survey, 60% of payments in 2021 were made via credit, debit, and mobile app payments. Therefore, if you’re a small business owner, it’s crucial to keep up with this trend and select a credit card processing company that supports your business effectively.
This guide will help you understand what to look for in a credit card processing company and introduce you to some of the top players in the market.
What is a Credit Card Processing Company for Small Businesses?
A credit card processing company, also known as a payment processor, is a service that enables businesses to accept credit and debit card payments from customers. These companies act as intermediaries between the merchant (business), the cardholder (customer), the card issuing bank, and the credit card networks (such as Visa or MasterCard). They facilitate the secure transfer of payment information, collect the funds from the issuing bank, and deposit these funds into the merchant’s account within one to two business days.
What to Look for in a Credit Card Processing Company?
Choosing a credit card processor for your small business involves considering several factors:
Security and Reputation:
To ensure safe and secure transactions, the processor should adhere to the highest security standards, such as PCI DSS compliance. Additionally, the company’s reputation in the market is equally important.
Cost:
The pricing structure of the processor is a critical factor. This includes per-transaction fees, monthly fees, and any hidden costs. A transparent pricing model is always preferable.
Compatibility:
The processor should be compatible with your existing payment infrastructure. It should also offer integrations with other business tools you use, such as accounting software or POS systems.
Reliability:
The processor should offer reliable and responsive customer service. It should also provide dependable uptime to ensure smooth business operations.
Supported Payment Types:
The processor should support all major credit cards and other popular payment methods, such as digital wallets and ACH payments.
Necessary Equipment:
Based on whether you operate a brick-and-mortar store or an online business, you might need specific processing equipment like POS systems or mobile card readers.
What Should I Pay a Credit Card Processing Company?
The cost of credit card processing can vary widely from one company to another. On average, the transaction fees range from 1.5% to 3.5%, plus a fixed rate between 10¢ and 50¢. Some processors charge a flat monthly fee in addition to per-transaction fees. Your final cost would depend on your business’s sales volume, the types of cards your customers use, and the pricing model of the processor.
Best Credit Card Processing Companies for Small Businesses
Now that you know what to look for, let’s explore some of the best credit card processing companies for small businesses.
Our Top 10
Price
Best For
Overall Total
Stripe
Stripe charges 2.9% + 30¢ per successful transaction for online payments. The fee for in-person payments using Stripe Terminal is 2.7% + 5¢ per transaction.
APIs and Integrations
Square
Square charges a flat rate of 2.6% + 10¢ for card-present transactions. For online transactions, the fee is 2.9% + 30¢.
Mobile Transactions
Payment Depot
Payment Depot offers membership plans starting from $49 per month, with transaction fees as low as 7¢ + interchange.
Wholesale Rates
Helcim
Helcim’s processing fees start at 0.4% + 8¢ for in-person transactions and 0.5% + 25¢ for online transactions, with no monthly payments.
Fast Growing Businesses
National Processing
National Processing offers plans starting from $9.95 monthly, with processing fees as low as 0.18% + 10¢ plus interchange.
Industry-Specific Plans
Gravity Payments
Gravity Payments’ nominal 1% fee applies to instant bank transfers made on the same day, with a maximum cap of $30. Additionally, a 2.95% fee is levied on all card transactions.
Niche Industries
Payline
Payline charges a monthly fee of $10 for in-person and $20 for online sales, with processing fees starting from 0.4% + 10¢ for in-person transactions.
High-Risk Merchants
Dharma Merchant Services
Dharma charges a monthly fee of $25 for most industries and $20 for nonprofits, with processing fees starting from 0.15% + 8¢ for in-person transactions.
Non-Profits
Merchant One
Merchant One charges a $13.95 monthly fee, flexible lease terms, and interchange plus options for qualified swiped rates of 0.29% – 1.55% and keyed-in rates of 0.29% – 1.99%.
Tiered Processing Fees
Evalon Payment Processing
Elavon charges 1% + 25¢ for online transactions and 2.6% + 10¢ for in-person transactions
International Businesses
Best for APIs and Integrations
Stripe is renowned for its powerful APIs that enable businesses to create custom payment solutions. It supports all major credit cards and a wide range of digital wallets.
Why do we like it?
Stripe’s transparent pricing and robust features make it an excellent choice for online businesses. It provides 24/7 support via phone, chat, and email.
Industries:
Stripe caters to various industries, including e-commerce, software, nonprofits, and platform businesses.
Prices:
Stripe charges 2.9% + 30¢ per successful transaction for online payments. The fee for in-person payments using Stripe Terminal is 2.7% + 5¢ per transaction.
- Customizable and scalable payment solutions
- Support for international payments in 135+ currencies
- Comprehensive APIs and documentation
- Not ideal for high-risk industries
- Some advanced features require technical expertise.
Best for Mobile Transactions
Square revolutionized the payment industry with its simple, flat-rate pricing and user-friendly mobile POS system. It’s an excellent choice for businesses that need to accept payments on the go.
Why do we like it?
Square’s free mobile card reader, transparent pricing, and comprehensive features make it ideal for small businesses and startups.
Industries:
Square serves a variety of industries, including retail, food & beverage, beauty & wellness, and professional services.
Prices:
Square charges a flat rate of 2.6% + 10¢ for card-present transactions. For online transactions, the fee is 2.9% + 30¢.
- No monthly fees or long-term contracts
- Includes free POS software
- Support for digital receipts and offline payments
- Not suitable for high-risk industries
- Customer support is not available 24/7
Best for Wholesale Rates
Payment Depot has a unique membership pricing model that eliminates the markup fees associated with traditional processing.
Why do we like it?
Payment Depot’s subscription model can result in significant savings for high-volume businesses. It also offers next-day funding and 24/7 customer support.
Industries:
Payment Depot caters to most standard-risk businesses and some high-risk industries.
Prices:
Payment Depot offers membership plans starting from $49 per month, with transaction fees as low as 7¢ + interchange.
- Transparent subscription pricing
- No percentage markup on transactions
- Free equipment with specific plans
- Not suitable for businesses with low sales volumes
- Monthly membership fee
Best for Fast-Growing Businesses
Helcim offers interchange-plus pricing with volume discounts, making it an excellent choice for growing businesses.
Why do we like it?
Helcim’s transparent pricing, all-inclusive platform, and automatic volume discounts offer great value for small businesses.
Industries:
Helcim serves several industries, including retail, restaurants, professional services, and nonprofits.
Prices:
Helcim’s processing fees start at 0.4% + 8¢ for in-person transactions and 0.5% + 25¢ for online transactions, with no monthly payments.
- Automatic volume discounts
- No monthly fees or contracts
- All-in-one platform with POS, inventory management, and customer management
- Not suitable for high-risk industries
- No 24/7 customer support
Best for Industry-Specific Plans
National Processing offers competitive rates and industry-specific plans, making it an excellent choice for various business sectors.
Why do we like it?
National Processing offers some of the lowest processing rates in the industry, along with a range of valuable integrations and payment options.
Industries:
National Processing is ideal for various industries, including retail, restaurants, e-commerce, and nonprofits.
Prices:
National Processing offers plans starting from $9.95 monthly, with processing fees as low as 0.18% + 10¢ plus interchange.
- Low processing fees
- Various industry-specific plans
- No long-term contracts
- Fees may be higher for businesses processing less than $10,000 per month.
- Early termination fees apply in some cases.
Best for Niche Industries
Gravity Payments offers custom payment solutions designed to align with the specific needs of niche industries.
Why do we like it?
Gravity Payments’ industry-specific solutions and excellent customer service make it stand out. It serves multiple niche industries, including veterinary, outdoor power equipment, and legal services.
Industries:
Gravity Payments caters to various industries, focusing mainly on niche sectors.
Prices:
Gravity Payments does not disclose its pricing information publicly. Merchants need to contact the company for a custom quote.
- Industry-specific custom solutions
- Excellent customer service
- Supports a wide range of payment methods
- Pricing is not transparent.
- It may only be suitable for some businesses.
Best for High-Risk Merchants
Payline Data is a merchant account provider that offers low, interchange-plus pricing and supports high-risk merchants.
Why do we like it?
Payline’s competitive pricing and transparent fees make it an excellent choice for small businesses, especially high-risk merchants.
Industries:
Payline serves a variety of industries and also offers high-risk merchant accounts.
Prices:
Payline charges a monthly fee of $10 for in-person and $20 for online sales, with processing fees starting from 0.4% + 10¢ for in-person transactions.
- Competitive transaction rates
- No long-term contracts or cancellation fees
- Provides high-risk merchant accounts
- Separate monthly fees for in-person and online processing
- Negative user reviews
Best for Nonprofits
Dharma Merchant Services offers reduced fees for nonprofits, making it an excellent choice for these organizations.
Why do we like it?
Dharma’s competitive transaction pricing and commitment to simplicity and affordability make it an excellent choice for nonprofits and small businesses.
Industries:
Dharma serves a range of industries, with a particular focus on nonprofits.
Prices:
Dharma charges a monthly fee of $25 for most industries and $20 for nonprofits, with processing fees starting from 0.15% + 8¢ for in-person transactions.
- Competitive transaction pricing
- Reduced fees for nonprofits
- No long-term contracts
- Monthly fees may be a barrier for some businesses.
- Separate accounts are required for online and in-person payments.
Best for Tiered Processing Fees
Merchant One offers a tiered pricing model, making it a good option for businesses that want to optimize their processing costs based on transaction volumes.
Why do we like it?
Merchant One’s competitive rates and personalized customer service make it a good option for small businesses.
Industries:
Merchant One serves a variety of industries, including retail, B2B, restaurants, hospitality, and e-commerce.
Prices:
Merchant One’s pricing is customized based on the business type, equipment needs, and sales volume.
- Competitive transaction rates
- Tiered pricing model
- Personalized customer service
- Not all fees are disclosed online.
- Long-term contracts with termination fees
Best for International Businesses
Elavon offers payment processing solutions in more than 30 countries, making it a good option for international businesses.
Why do we like it?
Elavon’s extensive global presence and industry-specific solutions make it an excellent choice for businesses across different countries.
Industries:
Elavon serves several industries, focusing on hospitality, healthcare, and retail.
Prices:
Elavon’s pricing is customized based on the business type and transaction volumes.
- Wide international presence
- Industry-specific solutions
- 24/7 customer support
- Pricing is not transparent.
- Service quality may vary across countries.
Bottom Line
Choosing the best credit card processing company for your small business involves making a significant decision. It requires carefully evaluating your business’s needs, transaction volumes, and budget. The best credit card processing companies like Stripe, Square, and Payment Depot balance competitive pricing, robust features, and excellent customer support, making them ideal for most small businesses.
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Frequently Asked Questions
Choosing a credit card processor is an essential decision for your small business. Take the time to evaluate your options and select a company that best meets your needs. Happy processing!
