Credit Cards

7 Best Credit Card Processors for Small Businesses

Whether youre a freelancer whos picking up a new side hustle or an established brick-and-mortar small business, you need a solution to accept credit card payments for your business. Checks are too risky, and since everything nowadays is digital, its more comfortable and more efficient to receive payments this way.

Whether you’re a freelancer whos picking up a new side hustle or an established brick-and-mortar small business, you need a solution to accept credit card payments for your business. Checks are too risky, and since everything nowadays is digital, it’s more comfortable and more efficient to receive payments this way.

Years ago, you had to find a payment processing company who would make a super-long application over the phone, send you a massive brick by which you have to use to swipe credit cards and charge you an arm and a leg. Trust me, I did this with my first business, and it was a terrible experience.

Now things are easier. Companies like Square allow you to take credit card payments by using just your smartphone and a small device that plugs into it. In this article, I’ll review the best credit card processors so you can decide which one is right for you.

1. Shopify

Shopify is an all-in-one credit card processor but offers much more. Its primary focus, and where you’ll find the most benefit, is e-commerce. Further, Shopify specializes in e-commerce for businesses that don’t exactly have an online presence. Meaning, you either don’t have a site, or you have a website, but no easy way to sell products. If you are looking to sell products online and want to avoid places like eBay and Etsy, you can get started with Shopify for about $30 per month. Their plans include a domain name, secure hosting, and website templates (which are amazing-looking) so you can get started immediately. If you’ve heard of, it’s similar–only Shopify steps up their game by offering a full shopping cart experience for you.

After the monthly fee you pay for getting your business online, Shopify charges you for online transactions–as any other credit card processor would. Their rates are similar to others, charging 2.9% plus $0.30 for all online purchases. If you make small online sales or don’t have a lot of volume yet, it may not be the best pricing, but the additional tools and resources Shopify offers help to make up for it.

Shopify also allows you to accept in-person payments, which is a nice benefit for a brick and mortar business which also sells online. For in-person sales, Shopify charges a flat 2.7%. Just add a retail package to your account, and you can purchase things like a card reader and barcode scanner. Keep in mind, this isn’t Shopify’s primary business focus, so their equipment leaves much to be desired.

If you’re a new online business with a poor website experience or no shopping cart, Shopify is your best bet for getting started. Their online templates are easy to use and come out looking highly professional. Having a good user experience on your website can lead to more sales, too. But if you’re a physical store that does most of its transactions in-person, opt for a company like Square.

2. Square

If you’ve gone to a local hair salon or bakery, chances are you’ve seen Square being used. Square was one of the very first credit card processing companies to do away with tiered pricing, which was a big draw for many small business owners. Instead of throwing in up-charges, hidden monthly fees, bundling fees, or equipment fees, Square charges its clients 2.75% on any transaction that uses a card swipe, chip-read, or tap. They then charge 3.50% plus $0.15 for any sale that is keyed in (not by directly using the credit card).

The thing we love about Square is its ability to quickly get you started with accepting credit card payments, at a low cost. If you are just getting started with your business, have infrequent transactions, or sell goods or services that don’t cost a lot of money, Square is an excellent option. Because there is no monthly fee and pricing is flat regardless of what you charge, you’ll be able to focus more on your business and less on the nitpicky costs of accepting payments.

To make your business life even more comfortable, Square produces its own mobile and chip reader, as well as the iPad terminal you’ve undoubtedly seen (you know, the one that swivels around to awkwardly ask you if you’d like to add a tip onto your muffin purchase?). I’d consider these necessities, and they’re relatively cheap. Square also offers a bunch of other stuff you’ve probably never heard of–like email marketing services, accounting software, payroll solutions, and much more. So if you’re ready to get into business, Square is an excellent option regardless of your business tenure.

3. Stripe

If you’re operating only online, Stripe is one to look at it. They don’t offer in-person transaction support, but Stripe is focused on e-commerce sales, and they do it quite well. Stripe has an API that’s free to use–which allows you to integrate it into a custom-built checkout experience on your website or even integrate it into an app you’ve built. Stripe is definitely more technical, and will probably require some coding skills to get it to work correctly, but its customization is excellent.

Stripe charges 2.9% plus $0.30 per transaction but has no monthly or hidden fees. If you accept international credit cards, you’ll get charged an additional 1%. Stripe also allows you to take payment through ACH and digital wallets, which other card processors don’t offer.

Adding a checkout screen to your site is easy, as you merely embed code onto the page and everything is set up for you. Though to make it the best experience possible you’ll want to utilize the API and code it appropriately to what your site, store, or app needs.

4. PayPal

Nearly everyone has heard of PayPal by now. The company started in the late 90s and was eventually purchased by eBay–which is where it made a name for itself. Everyone on eBay paid through PayPal it seemed. A few years ago, PayPal actually broke away from eBay and became its own company. Now, PayPal focuses on supporting small businesses with a variety of financial tools and resources to help both e-commerce and in-person sales.

Yes, PayPal still does the bulk of its business online. So if you have an online store, you should strongly consider using one of the oldest and most experienced companies in the industry. PayPal charges online retailers 2.9% plus $0.30 of every online transaction. If you make small sales online, this may not be worth it to you, but if you’re selling at a high-enough volume or can price your products or services accordingly, PayPal’s fees are relatively competitive.

For in-person sales, PayPal charges a flat 2.7% on all transactions. The company offers mobile and chip readers like Square, but they aren’t as sleek or functional. Also, PayPal doesn’t provide the iPad stand or any proprietary software like Square.

If you operate solely online, PayPal is one of, if not, the best option for you. If you do a mix between online and in-person, I’d still consider using PayPal, since they do offer the equipment to accept in-person payments, and the fees are lower than companies like Square. However, if you’re only making in-person sales (i.e., a bakery or restaurant), I would look elsewhere for your payment processing capabilities, just because there are better options.

5. Payment Depot

If you’re just starting out or picking up a side-hustle, Payment Depot won’t be for you. But if you’re running an established business that sells expensive goods or services, or you have a very high volume of sales, you may want to consider this company. Payment Depot focuses on clients who have significant, single transactions or enough sales to make up for the monthly costs, and their subscription tiers mirror that.

There are four subscription levels for Payment Depot, ranging from $29 to $99 per month. The plans vary based on the volume of sales you have. Here’s a look at the transaction limits for each level:

  • $29/month plan – $25,000 transaction limit
  • $49/month plan – $75,000 transaction limit
  • $69/month plan – $200,000 transaction limit
  • $99/month plan – no transaction limits

Beyond this flat monthly fee, you’ll be charged a per-transaction fee, which starts at $0.15 per transaction (on the $29 plan) and drops down to $0.05 per transaction (on the $99 plan). So you can see, if you’re a side-hustle hair stylist making a couple of hundred dollars a month, this probably isn’t your best bet. But if you own a store that sells high-priced, restored furniture, for example, it might be your best bet. In fact, many hotels and restaurants use this service.

Payment Depot doesn’t have the same type of sleek software and equipment that Square does–as it focuses more on functionality and pricing. You can get equipment from them, but it’s expensive, and it looks a bit dated.

6. Dharma Merchant Services

Dharma Merchant Services is a credit card processing company that targets non-profit organizations. One of their primary goals is to help non-profits run their business effectively while keeping their service affordable. For-profit companies can still use the service, but it’s slightly more expensive. Unlike some of the other companies, Dharma doesn’t build interchange into their pricing. Interchange is the base cost of a credit card sale–which is paid regardless.

So before interchange, Dharma charges 0.20% plus $0.10 for an in-person sale and 0.30% plus $0.10 for an online purchase (for non-profits; for-profit companies will pay slightly more). Depending on the type of card the customer uses, you’re looking at anywhere from 1% to 2.5% in fees, per transaction. This is still significantly less than most other credit card processors, though.

While there are some cases where you’ll pay more for using Dharmas services, it might be important to know that they consistently get good reviews of their customer service, and they donate money to social causes. Last year, for example, Dharma Merchant Services gave over $100,000 to non-profits dealing in areas like animal welfare, education, and social change.

If you’re a non-profit organization, I’d look at Dharma first–but know that they may not be the least expensive when it all shakes out. That really depends on your volume of sales. Dharma tends to discourage companies with less than $10,000 per month in transactions from using their service due to this. Hey, at least they’re honest.

7. Helcim

One thing Helcim does that most other card processors don’t is that they get transparent with their pricing. Interchange can get complicated because of the rate changes based on the type of card, and the level of rewards the card offers. For instance, a high-reward credit card can have a much higher interchange rate than a no-reward card. Helcim’s goal is to help you find the best plan possible by showing you what you can expect to pay. Their pricing page allows you to select the type of business you have, plug in your estimated sales, and they’ll give you an average price that you’ll pay for every transaction, based on data they have.

In many cases, their pricing works out to be a lot cheaper than most other credit card processors. For instance, I said I was a retail, card-present business with no more than $25,000 in sales each month. I estimated my per-transaction purchase to be about $100, and the average transaction rate I got was 1.82% plus $0.08–which is cheaper than many others. You can then see their full pricing sheet to know exactly how much every transaction costs (if you want to get into the details a bit).

In addition to the per-transaction fee, you’ll pay a monthly fee depending on what kind of business you have. If you’re operating only in-person, you’ll pay a flat $15 per month. If you want to sell online, you’ll pay $35 per month. One nice feature, though, is that Helcim integrates with services like PayPal and Shopify so you can use their platforms (i.e., buttons, shopping carts) but still keep your payment processing service with Helcim.

Overall, this is a somewhat confusing pricing model. But if you take the time to understand it and narrow down exactly what you need, you can end up saving a significant amount of money with Helcim.


As you can see, there are plenty of options to choose from when it comes to credit card processors. Many of these companies have similar fee structures, but they’re all unique in the way they operate. This is a good thing, as everyone has different business needs, so you’ll be able to find a company that fits exactly what you need to start accepting credit card payments.

Related: Best Business Checking Accounts For Freelancers and Entrepreneurs

Your turn: which of these companies have you tried, and which has been your favorite from a customer perspective? Share your thoughts below!

Chris Muller

Chris Muller

Chris has an MBA with a focus in advanced investments and has been writing about all things personal finance since 2015. He's also built and run a digital marketing agency, focusing on content marketing, copywriting, and SEO, since 2016. You can connect with Chris on Twitter @moneymozartblog.

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