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The 10 Cheapest Credit Card Processing For Small Business

The process of taking payments by credit card is called credit card processing. There are numerous actors involved in a seemingly simple tap, swipe, or dip that takes only seconds. 

The payment processor performs as the middleman, transferring money from the issuing bank to the merchant account. Transmitting card data via a payment gateway is how transactions are verified and authorized, after which they may be accepted or denied by the payment processor.

The payment provider may utilize a third-party or in-house payment gateway. A merchant account on the other hand is the account used by a payment processor to move money after purchases are authorized.

How to Examine The Lowest Cost Credit Card Processing for Small Businesses

To determine which credit card processing firms are the most cost-effective, we compare start-up prices, monthly fees, processing costs, and more. Payment Depot is the most cost-effective credit card processor for small businesses according to our research. With low interchange-plus rates for internet and in-person transactions, it provides cheap all-in-one subscription pricing.

How Credit Card Processing Fees is Calculated

Credit card processing fees are calculated as follows:

  • Total monthly payment processing costs = (% processing fee * monthly sales volume) + ($ processing fee * # of monthly transactions) + any monthly or other fees

If you need to take cards both online and in-store, you’ll have to do two calculations since many processors offer varying prices for card-not-present and card-present transactions.

How To Lower Credit Card Processing Fees

Many firms find credit card processing costs to be a significant recurring expenditure. They are unavoidable to some extent and only rise in number as your firm expands. However, to minimize your fees, there are a few things you may do and they include:

  • Encourage Customers to Make Payments in Cash
  • Take ACH payments
  • Make an application for B2B Rates
  • Obtain quotations from a number of vendors

Encouraging clients to pay in cash is the initial step to lowering your credit card processing costs. In effect, businesses may adjust prices and give a reduction to consumers who pay with cash to reduce their processing expenses.

However, examine the legislation in your local area and state carefully. Cash discounts are permitted in many places, but credit surcharges are not in many others.

The Benefits Of Cheap Credit Card Processing

The key advantage of credit card processing is that it enables you to take debit and credit cards as well as mobile wallets like Google Pay and Apple Pay. The acceptance of these sorts of payments is becoming increasingly essential for nearly every sort of company since many clients do not have cash on them. 

Another advantage is that credit card processors enable you to take payments from a variety of sales channels.

  • In person: It is possible to take payments using a POS system, payment terminal, or card reader, at your brick-and-mortar store. You may also accept payments online with a mobile card reader or an app. 
  • On the phone: You may manually enter card information in your computer if you use a virtual terminal.
  • Online: You may take payments in a variety of ways thanks to the internet. You can include a hosted payment page or payment form on your website to accept online payments. You can offer payment links on social media platforms and in your emails, text messages, and invoices.

Factors to Consider When Choosing Credit Card for Small Businesses

The following are some key things to think about when selecting a credit card processing firm for your small business.

  • Pricing structure: You should find out if you will have to pay a monthly fee in addition to the per-transaction cost. The interchange fee is added to each purchase, whereas a flat-rate plan is based on a set price. Check out for transparent pricing that is simple to comprehend so you know exactly what you’re paying for.
  • POS system: Affiliating with a credit card processor which has POS software and hardware at its disposal, such as card readers, terminals, cash registers, and programs relieves you of the burden of purchasing equipment on your own as a small business. It’s always better to get a payment processor that provides free or low-cost equipment.
  • No additional costs: Support, chargebacks, statements, and PCI compliance are all additional charges that credit card processors may charge for. The finest credit card processors for small enterprises will not charge for these services.
  • Customer service: In case you’re having trouble processing a payment, you shouldn’t have to pay extra for assistance. Customer service should be available 24 hours a day, 7 days a week.
  • EMV-compliant: Check to see whether the firm accepts chip cards.
  • PCI-compliant: According to PCI Security Standards Organization, the credit card processor should follow PCI-DSS (Payment Card Industry Data Security Standard).

The 10 Best Cheapest Credit Card Processing For Small Business

Cheapest Credit Card Processing For Small Business

1. Helcim

Helcim is an excellent alternative for small businesses wanting low rates and no monthly subscription expenses. The fee structure for interchange-plus is cost-effective, especially for firms with a high sales volume. Also, its website makes it simple to obtain pricing information. Because the volume discount is automatically applied as the quantity you handle increases, it’s an excellent benefit to have as your business expands.


  • In-person payments: For businesses with less than $25,000 in monthly card transaction, the interchange fee is 0.3 percent and 8 cents for each transaction.
  • Online and keyed payments: For businesses with less than $25,000 in monthly card transaction, the interchange fee is 0.5 percent and 25 cents for each transaction. 
There are no cancellation costs or long-term obligations. 
There are no monthly subscription costs.
There are no setup costs.
There are no costs associated with PCI compliance.
After a company processes over $25,000 in payments every month, its transaction processing rates drop.
Digital currencies are not effective with high-risk merchants, such as those that are more vulnerable to chargebacks and fraud.
24/7 support is not guaranteed.

2. Square

Square is a low-cost credit card processing solution that’s especially suited for small and medium-sized merchants. Also, Square offers a free mobile card reader as well as free POS software, due to its clear, flat-rate pricing. It’s one of the most cost-effective payment solutions available.

Businesses may accept various types of payments such as online and in-person payments, using the payment service provider. For in-person payments processing, you can decide to use free POS software together with one of its company’s hardware choices.

Small- to medium-sized businesses can also take advantage of personal or restaurant POS software solutions that provide more features. You may also utilize the company’s API connections to process credit cards available on your e-commerce site or website.


  • Swiped, tapped and dipped in-person payments: 2.6 percent plus ten cents for each transaction.
  • Transactions with no card present: 3.5 percent plus fifteen cents.
  • E-commerce transactions: 2.9 percent plus thirty cents.
There are no refund, early termination, or setup costs.
There are no costs associated with meeting PCI requirements.
There is no monthly charge.
POS software is free.
The mobile card readers are free.
More costly for some organizations than an interchange-plus pricing approach.
Can’t accept high-risk merchants.
24/7 support is not guaranteed.

3. Stax

Stax charges clients a monthly fee and then charges an interchange plus fixed per-transaction rate, that is 8 cents for each in-person transaction, unlike some of its rivals.

For BigCommerce, this cost structure may help high-volume firms save money, particularly if they would have otherwise paid more than $99 monthly in percentage markups as well as other costs.


  • Flat monthly membership fee: Begins at a monthly fee of $99.
  • In-person transaction: 8 cents plus the interchange fees.
  • Keyed-in transaction: 15 cents plus the interchange fees.
No contracts.
PCI compliance is part of the business plan.
Technical support is available 24/7.
Funding add-ons and custom branding are offered.
It’s not a good fit for small businesses with little traffic.
Does not provide services to high-risk companies.

4. Payline Data

Payline Data is a merchant account service provider that specializes in interchange-plus pricing. It offers two plan options, one for physical shops and one for internet businesses. It’s not ideal for firms that sell items both in-store and online to pay for both plans, but it may be one of the cheapest alternatives for businesses that only need one or the other.

It also caters to high-risk merchant accounts in sectors such as tobacco, internet gaming, fantasy sports, self-storage, and other industries.


  • Taking an in-person plan: Interchange + 0.2% and 10 cents for each transaction; $10 per month for a monthly fee.
  • No credit-card plan: Interchange +0.4% and 20 cents for each transaction: $20 per month for a monthly fee.
There are no cancellation costs or long-term obligations.
There are no PCI compliance costs.
High-risk merchant accounts are available.
You must pay a minimum monthly processing fee of $25.
24/7 support is not guaranteed.

5. Payment Depot

Payment Depot is a merchant account service that utilizes an interchange-plus pricing system and charges its transaction fees depending on your plan, rather than the terminal you employ. It has a 90-day trial membership; in case you cancel the account within the first 90 days, you will receive a full refund of your annual membership fee.


  • Starter membership: Interchange + 15 cents for each transaction; $79 every month.
  • Popular membership: Interchange + 10 cents for each transaction; $99 every month.
  • Enterprise membership: Interchange + 7 cents for each transaction; $199 every month.
Allows you to key in credit card numbers without using a physical keyboard. A virtual terminal is included for free.
For free, you may reprogram your current terminal.
During your 90-day trial, you may cancel at any time and receive a full refund of your annual membership fee.
No cancellation charges are incurred.
PCI compliance is also included.
There is a maximum number of transactions that can be processed by each membership.
Doesn’t provide services for high-risk businesses.
24/7 support is not guaranteed.

6. Stripe

Stripe is a payment processing platform that allows you to accept online payments without incurring any hidden fees or commitments. Also, Stripe has flat-rate pricing, is straightforward, and has no subscription fees, making it one of the simplest payment systems for internet enterprises.

You can get a lesser-cost processor from another company, but you’ll find it hard to beat the unavailability of flexibility, additional costs, and included payment features within the platform. This payment service also provides its own business data, invoicing, billing, and tax calculation capabilities.


  • Online payments: 2.9 percent + 30 cents for each transaction.
  • In-person payments: 2.7 percent + 5 cents for each transaction.
There are no setup costs.
You don’t have to pay a monthly subscription fee.
Availability of 24/7 support.
There are over 450 different platforms and extensions to choose from.
Not fit for companies that need a more sophisticated POS terminal.
This isn’t compatible with high-risk vendors.

7. DMS (Dharma Merchant Services)

DMS provides nonprofit organizations with reduced monthly rates and processing costs, making it a popular choice. It is also a B Corp, which means it adheres to greater environmental and social criteria than other companies. This is a significant benefit for small companies that value their reputation of working with socially responsible firms. The merchant service provider, in particular, has contributed thousands of dollars to charity over years. There are also special discounts for firms that process more than $100,000 in revenue each month.


  • Regular: Interchange + 0.15 percent and 8 cents for each in-person transaction; monthly fee of $25.
  • Nonprofits: Interchange + 0.10 percent and 8 cents for each in-person transaction; monthly fee of $20.
There are no early termination charges or long-term contracts.
Includes free access to a virtual terminal as well as online reporting.
PCI compliance costs are not imposed.
Availability of 24/7 support.
A monthly fee of $25 is imposed.
Does not work with high-risk sellers.

8. National Processing

This merchant account is the most convenient option for those who can afford it. It’s also a good choice for companies that want to pick from a variety of plan alternatives and have the financial flexibility to pay monthly.

Free equipment and hardware are included in every strategy. For example, the cheapest plans usually come along with a mobile card reader that is free.


  • Restaurant: $9.95 every month; interchange + 0.14 percent and 7 cents for each transaction although the rates may differ.
  • Retail: $9.95 every month; interchange + 0.18 percent and 10 cents for each transaction although the rates may differ.
  • E-commerce: $9.95 every month; interchange + 0.29 percent and 15 cents for each transaction although the rates may differ.
  • Subscription: $59 every month; interchange + 9 cents for each transaction although the rates may differ.
  • Subscription Plus: $199 every month; interchange + 5 cents for each transaction although the rates may differ.
There are no minimum monthly payments required.
There are no early termination penalties or long-term contracts.
If a firm’s present rates can’t be beaten, it pays out an incentive. To qualify, the company should process a minimum of $10,000 in payments each month.
Provides high-risk merchant account.
Each package includes free hardware re-programming and a mobile card reader that is free.
There are also other expenditures, for example, PCI compliance costs. Finding these isn’t simple.
24/7 support is not guaranteed.

9. PayPal 

PayPal is a popular online payment service that provides small and medium-sized enterprises with an array of tools. For regular sales, especially those with an average transaction amount of less than $20, PayPal offers some of the most cost-effective credit card processing.

PayPal also provides discounts for non-profit organizations, especially during online payment processing. Although most online payments are found to be very costly, PayPal offers very low rates making it an excellent choice for organizations.


  • Monthly fee: It is free of charge.
  • Chargeback fee: $20 for every transaction.
  • Online transaction fees: 3.49 percent plus 49 cents for every transaction.
Flat-rate prices vary based on usage.
Accepts Venmo, PayPal, and PayPal Credit payments.
Qualified organizations receive a discounted processing rate.
Free online checkout and invoicing.
There’s a weekly limit on keyed-in and swiped payments.
The funds are held for 30 days over the weekly limit.
Issues on account stability.
Automated bank account deposits are not possible.

10. Cayan

Cayan is an ISO that bills itself as a “free-standing” organization, noting that it provides both bundled and cost-plus pricing for credit card processing. Also, Cayan does not provide pricing plans on the website, which implies merchants need to negotiate a pricing plan that is suitable for them.

Custom pricing.
Availability of 24/7 support. 
Customer service that is responsive and adaptive.
After a period of 60 days is over, you will be charged a termination fee.

Cheapest Credit Card Processing Companies Comparison Table

Credit card processing companyPayment service or merchant account provider Pricing structureTransaction feeChargeback feeMonthly feeSupport 
HelcimMerchant account providerInterchange-plus0.03% +8 cents +interchange$15N/AMonday – Friday
Square Payment service providerFlat-rate 2.6% + 10 cents$0N/A unless specialty software is usedMonday -Friday
Stax Merchant account providerInterchange-plus and a monthly subscription fee8 to 15 cents + interchange$25Monthly subscription of $99.24/7
Payline DataMerchant account providerInterchange-plus and a monthly subscription fee0.4% + 20 cents$10Monthly subscription of $10.A processing fee of $25 should be met monthlyMonday – Friday
Payment DepotMerchant account providerInterchange-plus and a monthly subscription fee7 to 15 cents + interchange$15Monthly subscription of $7924/7
Stripe Payment service providerFlat-rate2.9% + 30 cents$15N/A24/7
Dharma Merchant ServicesMerchant account providerInterchange-plus0.35% + 8 cents + interchange$25Monthly fee of $25Monday – Friday
National ProcessingMerchant account providerInterchange-plus and a monthly subscription fee0.14% + 7 cents$9.95Monthly subscription of $9.95Monday – Friday
PayPal Payment service providerFlat-rate2.29% + 9 cents$20FreeMonday – Saturday
CayanMerchant service providerN/AN/AN/AN/A24/7

Costs to Expect When Choosing a Credit Card Processor for Small Businesses

When it comes to picking a credit card processor, there are generally three layers of costs to consider. They include:

  • Rates: They are costs associated with each transaction. The fees for transactions are generally a percentage of the entire sale value. Card processors charge you additional few cents for each transaction above the per-transaction rate. 
  • Fees: Service fees are charged by processors. The majority of processors charge these expenses monthly, which are evident on your bill; however, they can also be imposed annually or quarterly.
  • Equipment costs: Generally, this is a one-time expenditure for the hardware required to take credit cards. When possible, we recommend acquiring processing equipment ahead of time. Although some processors provide leasing, it is usually regarded as exorbitant in this industry.

Credit Card Processing Rates For Small Businesses

The card brand’s assessment cost, interchange rate, and processor’s markup make up the cost of using a credit card processor. The assessment fee and interchange rate are determined by the card networks where everyone usually pay the same amount and this part of the rate is not negotiable. On the other hand, each processor controls its own margin; therefore, it is negotiable.

The rate structure or pricing model of a processor is built from three parts:

  • Flat-rate pricing: Flat-rate pricing is often the most cost-effective choice for businesses that process not more than $5,000 per month or that have small sale tickets since they only pay a fee for every transaction.
  • Interchange-plus pricing: For firms that earn a lot of money from credit card transactions, interchange-plus pricing is the way to go. The reason for this is that the price you receive is merely the processor’s markup. Here, the pricing is negotiable.
  • Bundled, or tiered pricing: The processor combines the interchange rates, assessment fees, and their markup into three tiers: nonqualified, qualified, and midqualified. Mostly, they advertise only the qualified rate and just provide the other tiers if you request for them. With a tiered pricing structure, it’s impossible to figure out the processor’s markup because the number of tiers varies by processor making it tough to determine whether or not the rates you’re receiving are fair.

How Credit Card Processing Aids in Business Financing

Credit card processing can also assist you in analyzing your sales by preventing loss of client business owing to clients who prefer to pay with cards. Many services link to a POS system or give you access to an online dashboard where you may run comprehensive reports on your sales.

Many accounting software programs also integrate with them, saving you the time and error of manually entering transaction information, as well as reducing the danger of data entry mistakes due to data entered manually.

Fees Associated With Credit Card Processing for Small Businesses

The following recurring fees are charged by many credit card processing firms:

  • Monthly fee: Generally, it ranges between $5 and $15 per month. it is usually more if gateway and PCI compliance fees are included.
  • Minimum monthly fee: Usually $25, however it typically refers to the amount you pay in processing costs rather than the minimal sales volume required each month.
  • PCI compliance: On average, PCI compliance is $100 per year, but some businesses may charge it monthly or prorate it and charge it annually, which is sometimes included in the monthly fee.
  • Gateway payment fee: The fee is determined by the payment gateway you utilize. The majority are paid monthly, although some firms charge a per-transaction cost as well.
  • Network fees: A variety of network costs may be charged, such as the Fixed Acquirer Network Fee and the Merchant Location Fee, which may be levied in monthly or annual amounts.

Credit Card Processor Follows to Complete Transactions

  1. Point of purchase: Here, a customer uses a card reader or an e-commerce to make a purchase in the store.
  2. Payment Gateway: This is a software that connects information from a customer’s bank all the way to the merchant’s account via the payment processor. The payment gateway responds to a payment refusal or acceptance.
  3. Payment Processor: The payment processor function as a messenger, transporting data from the credit card users’ issuing banks to merchant accounts, whereby accepted payments are subsequently recorded. It verifies card security and allows the transfer of funds from issuing bank to merchant account, which is beneficial.
  4. Issuing Bank: This is a credit card company connected with a customer’s account.
  5. Merchant Account: Manages the transfer of funds from issuing bank to merchant account. It also enables a firm to take credit and debit cards, as well as online payments.

Bottom Line

Remember your objectives and compare your finest options if you’re trying to figure out which provider is best for you. It is not always easy to determine which business offers the lowest credit card processing rates because you’ll have to calculate your projected transaction amount and average ticket size.

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