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Best Retail Credit Card Processors for Small Businesses

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    Despite card payments accounting for 70% of all point of sale (POS) system transactions in 2020, many small business owners still don't have a credit card processor. The steep transaction fees and demanding application requirements discourage low-volume merchants. Fortunately, the best retail credit card processor for small businesses can help one avoid these issues.

    Merchants have a wide range of third-party small business credit card processing companies to choose from. These institutions offer merchant services to clients conventionally regarded as high-risk, from small businesses in risky industries to failed startups with low credit scores. Assess the features these systems offer and see which addresses your payment processing needs best.

    Retail Credit Card Processors for Small Businesses in 2021

    Best Overall Option: Square

    Key features:

    • No monthly fee
    • Competitive, predictable fixed rates
    • Accepts both low- and high-volume merchants
    • Free online store with payment gateway

    Square has a streamlined, multi-feature credit card processing system suitable for various small businesses, from single-product eCommerce shops to small pop-up store owners. They easily snag our top spot on the list.

    What sets Square apart from any other payment processor on the market are its rates. They follow a fixed fee of 2.9% +$0.30 for online payments and 2.6% + $0.10 for in-store, keyed-in transactions. Plus, qualified merchants get a free card reader with their accounts.

    Best for High-Volume Processing: Payment Depot

    Key features:

    • Next-day bank funding
    • Free virtual terminal and gateway
    • Easy monthly payment scheme
    • Competitive monthly fee

    Payment Depot offers cost-efficient subscription-based merchant services. Their customer service team is 100% transparent, they offer competitive rates, and there are no extra setup or application fees.

    Most small business startups prefer an interchange-plus pricing model during their first years. After all, with a per-transaction scheme, you won't have to pay for anything if your business doesn't use the POS.

    However, for business entities that already generate upwards of $5,000 in card payments every month, per-transaction fees will end up eating a hefty portion of your profits. In these cases, paying a monthly fee may be more cost-efficient.

    Best POS Systems: Clover

    Key features:

    • Multi-feature POS systems
    • Easy to set up POS
    • Competitive monthly fee
    • Visually pleasing POS design
    • Competitive rates

    Clover has an excellent multi-feature POS system ideal for retail shops of all sizes. Merchants can make the most of Clover's hardware devices by exploring the pre-installed app marketplace. They have programs to automate various business operations such as inventory tracking, invoice creation, revenue monitoring, and employee activity management.

    Best for High-Risk Businesses: PaymentCloud

    Key features:

    • Accommodates high-risk clients
    • Top-notch customer support
    • Reasonable, transparent fees (upon consultation)

    Businesses that operate in high-risk industries (e.g., CBD, electronic cigarettes, or financial services) can try PaymentCloud. They specialize in card processing services for merchants that most institutions would classify as risky.

    Now, there are other high-risk payment processors available, but you'd be hard-pressed to find one that can match PaymentCloud's rates. Despite taking on delinquent and risky clients, they still offer competitive pricing.

    Best Rates and Pricing System: National Processing

    Key features:

    • Low processing rates
    • Multi-tier pricing plans
    • No long-term contracts

    National Processing definitely has some of the lowest processing rates in the industry. They offer three different interchange-plus price plans for eCommerce shops, retail stores, and restaurants. The rates are as follows:

    eCommerce stores: 0.30% + $15
    Retail Stores: 0.18% + $0.10
    Restaurants: 0.14% + $0.07

    Also, despite the low rates, National Processing still has excellent customer support. In fact, each client gets a dedicated account manager to assist with all their concerns regarding their account, POS hardware, or payment processing system.

    Best for Low-Volume Processing: FattMerchant

    Key features:

    • Next-day bank funding
    • No early termination fee
    • No long-term contract

    Low-volume clients having a hard time identifying their payment processing needs can try FattMerchant. They offer both interchange-plus fees and flat rates, so you don't necessarily have to commit to one model right from the get-go. Plus, clients can switch between these two payment schemes with FattMerchant's month-to-month billing options.

    Best for Fast Approval: Merchant One

    Key features:

    • Fast application process
    • No POS device leases
    • Optional contract renewal

    If you lack the requirements that most merchant service providers ask for but need a payment processor fast, turn to Merchant One. They have a fast, streamlined application process. You can apply and qualify for an account, set up your POS devices, and start processing credit card payments in under two days.

    Plus, they have a 98% approval rate. Even applicants with bad credit scores, risky industry backgrounds, or high chargeback rates have a shot at approval.

    These are just some of the best credit card processing companies on the market. Feel free to explore options. Strive to find a brand that provides customized merchant services that suit your individual needs and demands.

    Although, be careful not to fall for disreputable credit card processing service providers that lure desperate merchants with seemingly good offers. Always read the terms. As a general rule, avoid any credit card processing company with undisclosed processing fees, pricing membership dues, and long lock-in contracts with high termination charges.

    Looking to expand your payment options? Processing Card has multiple resources on the best credit card processing services for online and brick-and-mortar small businesses. Check out the Processing Card website today!

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