The best card machines for small businesses (and how to take card payments)

The ability to accept card payments is crucial for many small businesses across the UK.

In the past, accepting card payments had been expensive and arduous. However, a host of new entrants to the market have made the process simpler and cheaper than ever.

Here, we’ve outlined the different things you need in order to accept card payments, including the best card machine options for small businesses and what they cost.

How do I accept card payments in my small business?

If you want to accept card payments, it’s not just a card machine that you’ll need – there’s a few other aspects you need to take care of first.

Merchant account

The merchant account is a ringfenced account where money from customers sits while the payment is authorised. It will be provided by your bank or payment service provider (PSP) and is a necessity for taking card payments.

Payment gateway

The payment gateway is the part of the chain that authorises the payment. This will generally be offered in conjunction with your merchant account, again by your bank or PSP.

Card machine

Finally, you need the card machine. There’s a range of card machine options for small businesses on the market, from affordable budget options right up to feature-heavy full point-of-sale systems.

Below, we’ve set out the different types of card machine for small business, what they cost, and which options may be suited to different types of business.

How much does a card machine cost?

The crucial question is cost. If you want to take card payments, you need to understand the costs involved, which are split between the machine itself and the processing fees.

The machine itself

There’s a number of different types of card machine, and your choice will depend on a range of factors including cost.

  • Smartphone card machines allow you to take payments from your iPhone or Android handset. They are often the lowest cost option, and they’re particularly good if you operate in lots of different locations – for example if you run a coffee cart. Some companies also offer smartphone deals with no lengthy contract.
  • Wireless card machines can be moved around a premises, meaning they’re great for restaurants and similar businesses. They operate using phone connections or Bluetooth, and there’s an increasing number of wireless options on the market that take up very little space at all. These are particularly handy in hospitality businesses.
  • Virtual terminals are used when you need to take card payments over the phone. However, virtual terminals are also increasingly being used in brick and mortar stores because they require little or no hardware investment. You can accept card payments using a virtual terminal wherever you have an internet connection.

The cost of your card machine will depend whether you buy or rent it. If you’re renting, you can expect to pay around £30 per month for a wireless terminal. If you’re buying outright, you could spend as little as around £80, or up to around £300.

Transaction fees

There is another cost involved in taking card payments, and that’s the transaction fee.

The amount you pay will depends on the number of transactions you’re processing, and on whether you are paying a percentage of the transaction or a flat fee. If it’s the former, you should expect to pay between two and five per cent, and if it’s the latter it could be up to 40 pence per transaction.

Finally, if you’re only processing a very low number of card transactions, you might incur a minimum usage fee, depending on your provider. This could be up to £50 a month, but popular new entrants to the market such as iZettle don’t charge any monthly fees at all.

What’s the best card machine for small business?

So now that you understand the costs, which card machine should you choose? These are some of the best options.

iZettle reader

iZettle is becoming an increasingly popular card machine option for small businesses. The reader is small, looks sleek, and is one of the cheapest options on the market.

The iZettle reader accepts chip and pin, contactless, and magstripe payments, and connects via Bluetooth to a dedicated iZettle app for smartphone or tablet. It has a battery life of up to eight hours, and just as importantly it’s very fast - contactless payments only take seconds.

PayPal Here

If you’re already using PayPal in your business, the PayPal Here terminal might be a good option. Again, the machine is cheap, and payments will clear into your PayPal account almost instantly. In addition, the PayPal Here card machine has no monthly fees, and no fixed contract.

SumUp

SumUp might be less recognisable than the two previous options, but they are still a strong competitor.

This is especially true if you only process a small number of card transactions, as use of the terminal incurs just one flat fee. The handset is also one of the cheapest on the market.

However, if you’re processing larger volumes of transactions, you should do some careful sums to check whether the SumUp is the most cost-effective option.

Have you encountered any issues taking card payments for your business? Let us know below.

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