Banking and payments
Card payments
How should you take card payments, and what kind of processor fits how you sell?
Six short steps. No email or account.
- Who needs it
- Anyone collecting money face to face, and anyone who wants payment at completion rather than later.
- When it matters
- As soon as customers ask to pay by card, which is usually immediately.
- Compare first
- Effective rate, all in
- Matters most when
- just started, established, growing, mature
Is this the right tool for you?
Customers expect to pay by card, whether at the counter, at the door or over the phone. Choosing the wrong setup can mean confusing statements, costs that are hard to compare, slow access to your money and trouble when a customer disputes a charge.
Signs you need it now
- You lose jobs or sales because you cannot take a card.
- You write card numbers down to process later.
- You do not understand your processing statement or what you are paying.
- Funds take longer to reach your account than you would like.
- You have had disputed charges and did not know how to respond.
When another area fits better
- You sell at a counter and need the till, stock and sales reporting as well as the card reader. Read the point of sale guide
- Most of your payments come from invoices you send. Read the invoicing guide
Recognise two or more of these? Sort out card payments next.
Tell us how your business runs and get a plan that puts card payments in order with everything else: what to set up first, your must-haves and what to compare.
What matters at your size
Working alone
A simple setup with flat, predictable pricing, a mobile reader and payment links is usually easiest. Understand how and when you get paid.
A small team
As volume grows, compare pricing models and ask whether a different arrangement costs less for your mix of transactions.
Several teams or locations
Multiple locations, higher volume and more disputes make negotiated pricing, detailed reporting and good dispute support worth the effort.
How the way you work changes the choice
- Trades at the customer's door
- A phone-based reader or tap-to-pay, plus payment links for customers who are not home. Check how it works when signal is weak.
- Counter service
- Card terminals tied into the point of sale, with fast checkout and tipping if relevant.
- Phone orders and remote payments
- Keyed-in and card-not-present payments usually cost more and carry more dispute risk. Payment links and stored cards with the customer's authorization are safer than writing numbers down.
What to compare
Effective rate, all in
Compare the total of percentage, per-transaction fee and monthly cost at your real volume.
Hardware requirement
Many providers now accept contactless on a phone with no reader at all.
Payout speed
Standard is often two days. Instant payout usually carries an extra fee.
Hold and reserve policy
Frozen funds are the single most damaging thing a processor can do to a small business.
Cost and setup effort
- Pricing models differ: flat rate, cost plus a markup, or bundled tiers. Compare using your own recent statements and transaction mix, and look for monthly, equipment and early termination fees.
- Read the contract terms on length, cancellation, equipment leasing and funds being held. Leased equipment and long contracts are common sources of regret.
- Card security rules apply to anyone who accepts cards. Tools that keep card numbers off your systems reduce what you are responsible for.
Trade-offs to weigh
- Simple flat pricing or negotiated pricing
- Flat pricing is predictable and easy to set up. Negotiated arrangements can cost less at higher volume but are harder to compare.
- Built into your software or separate
- Processing inside your invoicing, job or POS software is seamless but can lock you in. A separate processor gives more choice but needs integrating.
- Fast signup or stable account
- Instant-signup providers are easy to start with but may hold or freeze funds if activity looks unusual. Providers that review you up front can be slower to open but steadier later.
When to sort it out
As soon as customers ask to pay by card, which is usually immediately.
What taking a card actually costs
Card processing is priced in a few ways. Flat-rate pricing charges the same percentage, sometimes plus a small fixed fee, on every transaction, which is easy to predict. Interchange-plus pricing passes through the card networks' own charges plus a stated markup, which usually costs less at higher volumes but is harder to read. Monthly fees, hardware and chargeback fees sit on top of either.
Compare on the whole year, not the headline rate: estimate your monthly card volume and typical transaction size, and ask each provider what you would have paid last month, all fees included.
Where your customers pay
Match the setup to where the money changes hands. Taking payment at the customer's door needs a phone or small reader that works on the move. A counter needs a reader, and perhaps a point of sale. Work that is invoiced later needs payment links. Many small businesses need two of the three, so check that one provider covers them without separate accounts.
Holds, reserves and payout speed
Providers that let you start taking cards the same day make up for it by watching accounts closely, and an unusually large payment can trigger a hold on your funds while they review it. If your jobs are large or irregular, ask how holds work and how to warn them in advance. Check too how quickly money reaches your bank, and what faster payout costs.
Keep it connected
The payment should land against the right invoice in your books without anyone matching it by hand. If your job or accounting software has its own payments, weigh the convenience of one system against a separate processor's rates, and move later if the numbers justify it.
Your next step
Answer six short questions about how your business runs. You get an operating plan: where card payments fits among your priorities, the must-haves to hold every option to, and what to compare when you choose.
Where this comes first
Trades and businesses that usually sort this out early.
- Cleaning
- Plumbing
- Handyman and repair
- Pressure washing
- Mobile repair services
- Pest control
- Dental practice
- Therapy and counselling
- Fitness and wellness
- Veterinary practice
- Salon, spa and barbering
- Restaurant and cafe
- Food truck and catering
- Lodging and short-term rental
- Retail shop
- eCommerce store
- Property management
- Auto repair and service
- Childcare and early years
- Tutoring and training
- Photography and video
- Events and entertainment
- Nonprofit and community organisation
Often decided alongside
Other parts of banking and payments.