Paying with credit card

Unless your small business consists of running a lemonade stand on the corner of your street, sooner or later you’re going to need to accept credit and debit cards as payment to compete in today’s marketplace. Customers are increasingly relying on their “plastic” to make purchases, and consequently carrying less cash. eCommerce – something that barely existed twenty years ago – is now a serious competitor to physical retail stores. The more recent advent of smartphones, and the mobile payment features that are being added to them, promise to take this evolution even further by allowing consumers to leave both their plastic and their cash at home.

While we’re still a long way away from a truly cashless society, the options for processing credit and debit card payments have increased dramatically in just the past few years, and the set-up costs have come down to the point that even the smallest business can afford to offer this option. While accepting credit cards has traditionally required a hefty investment in card-reading terminals and expensive point-of-sale (POS) systems, today’s credit card processors leverage smartphone technology and cloud-based data storage to provide the same capabilities in a lighter, more affordable, and more mobile package.

In 2009, Twitter founder Jack Dorsey introduced Square (see our review), the first service that allowed merchants to accept credit card payments using their smartphones. Square included a card reader which, when attached to a smartphone, could read the magnetic strip information on a customer’s credit or debit card. The Square app provided an interface between the card reader and the merchant’s account for tracking transactions. While Square is still the leading player in the field of mobile payments today, it also has a lot more competition. Today’s small business owner has a large variety of providers to choose from. While all offer the same core function (i.e., credit and debit card processing), each provider also offers unique features and options that differentiate it from its’ competitors.

So, which one is right for you? The answer is going to depend on the nature and size of your business. Do you operate out of a traditional brick-and-mortar establishment? Do you sell online, either exclusively or in conjunction with a physical business location? Is your business a full-time occupation with a large volume of sales, or is it just a part-time side gig? Below, we’ve rounded up our top picks among the current crop of card-processing services, and summarized what we like (and don’t like) about each of them. Whether you’re running a large retail store or just selling fresh produce out of the back of your truck at the local farmer’s market, there’s a card-processing service that’s right for you.

Dharma Merchant Services

Dharma (see our review) takes its name from the term dharma, which is found in several Eastern religions. While it can mean many different things and there is no direct translation, it roughly refers to a “right way of living.” The folks at Dharma take this seriously, offering a full spectrum of credit card processing services for a fair and reasonable price. Their fee structures are transparent – interchange-plus pricing is used exclusively, and there are no annual fees. They also don’t charge account setup fees, early termination fees, or have a monthly minimum. Fees that they do charge (including PCI compliance fees) are fully disclosed on their website. Dharma is unique in the world of credit card processing companies in that they donate a significant percentage of their profits to charity, living up to their motto “Commerce with Compassion.”

In addition to merchant accounts, Dharma offers a variety of wired and wireless countertop terminals for in-store use. Their terminals are EMV-compliant and also support Apple Pay. Dharma offers mobile swiping through Authorize.Net, and also uses ShopKeep, one of our favorite iPad-based POS systems. Authorize.Net can also support online and mobile payments, and integrates with QuickBooks.

Dharma easily offers the fairest and most transparent fee structure in the industry. In addition to a flat $10.00 per month fee for store front and eCommerce accounts, transactions are billed according to an interchange-plus cost model. In-person transactions are charged 0.25% above cost, plus $0.10 per transaction, while eCommerce transactions are charged 0.35% above cost, plus $0.10 per transaction. For restaurants, Dharma offers a special discounted rate of 0.20% above cost, plus $0.07 per transaction. Other additional fees (such as PCI compliance fees) are clearly spelled out on Dharma’s website.

While there is no minimum monthly volume requirement, Dharma openly acknowledges that their full-service merchant accounts don’t make financial sense for low-volume businesses processing less than $10,000 per month in transactions. If your business falls into that category, they recommend either PayPal or Square.


  • Full range of services and equipment for both storefront and eCommerce businesses
  • Great customer support
  • Transparent pricing with no undisclosed fees
  • Discounted rates for non-profits


  • Not a good fit for low-volume (less than $10,000 per month) accounts

For more information about Dharma, see our complete review here.


Another one of our favorite providers, CDGcommerce (see our review) has been around since 1998 – long enough to have figured out what it takes to run a successful processing company and keep customers happy. CDG stands out from the crowd by not charging you any of the nickel-and-dime hidden fees that most other companies in the industry are notorious for. Their merchant accounts come with no account setup fees, no PCI compliance fees, no monthly minimums, and month-to-month billing with no early termination fees.

A basic merchant account with CDGcommerce costs only $10.00 per month, and includes free use of their proprietary Quantum payment gateway/virtual terminal (a free Authorize.Net gateway is also available as an alternative). Depending on your needs, you can add additional features like their cdg360 security package, which provides $100,000 in data breach/theft protection, PCI-DSS vulnerability scans, customized security alerts, and a number of other features – all for $15.00 per month.

While we generally highly recommend buying your credit card terminals outright instead of leasing them, we’ve made an exception for CDG. Rather than lock you into an expensive, four-year lease, CDG only charges $79 per year for terminal insurance. Wireless terminals will also require a $20.00 per month data plan and an additional $0.05 per transaction processing fee. This is a much better deal than a standard terminal lease, which can end up costing your thousands of dollars over the full term of the lease.

CDG also offers very competitive processing rates. The company currently offers two types of processing rate plans: simplified (i.e., flat-rate) pricing that’s available to any merchant regardless of monthly processing volume or processing history, and advanced pricing that’s only available to established merchants. All advanced pricing is interchange-plus and disclosed on their website. Here are their current rates:

Simplified Pricing:

  • Online: 95% + $0.30 per transaction (2.95% + $0.30 per non-qualified transaction)
  • Retail (swipe): 70% + $0.25 per transaction (2.90% + $0.30 per non-qualified transaction)
  • Retail (POS): 70% + $0.25 per transaction (2.90% + $0.30 per non-qualified transaction)
  • Mobile: 70% + $0.25 per transaction (2.90% + $0.30 per non-qualified transaction)

Advanced Pricing:

  • Online: interchange + 0.30% + $0.10 per transaction
  • Retail (swipe): interchange + 0.30% + $0.10 per transaction
  • Retail (POS): interchange + 0.30% + $0.10 per transaction
  • Mobile: interchange + 0.30% + $0.10 per transaction

Note that the advanced pricing rates quoted above are based on a monthly processing volume of between $10,000 and $25,000. Discounted rates are available for higher volumes.

With features like this, CDGcommerce hasn’t generated too many complaints from dissatisfied customers over the years. They are, however, the only company we’ve seen where the CEO has personally stepped in to address the few complaints that have occasionally tricked in. Thanks to CDG’s excellent customer service and support, however, he hasn’t had to do this very often.


  • Interchange-plus pricing for established merchants
  • Month-to-month billing with no long-term contracts or early termination fees
  • Free virtual terminal/payment gateway
  • Excellent customer service


  • Only available to US-based merchants

For a more detailed look at CDGcommerce, be sure to check out our full review.


“Trust, transparency, and fair pricing” is Helcim’s motto, and they live up to it by providing the most up-front, clearly-explained pricing structure of any of the credit card processing companies we’ve reviewed here. A Canadian company, they also have an office in Seattle and provide full support to US-based merchants.

Helcim (see our review) offers a full gamut of services and equipment for both storefront and online businesses. Their website features a variety of EMV-compliant and NFC-capable credit card terminals, starting at $199. Unlike many of their competitors, they encourage US customers to buy their terminals outright, rather than renting or leasing. Helcim will reprogram your current equipment for free if it’s up-to-date. If your current terminal isn’t compatible, they’ll exchange it for a refurbished terminal for $75.00. Unfortunately, Canadian EMV-compliant terminals are not designed to be transferred or resold, so Canadian customers will have to use the rental option or buy a new machine. Renting on a month-to-month basis (which is not the same as leasing) is usually the best option for Canadian merchants.

Helcim supports eCommerce through their Helcim Virtual Terminal, a 100% web-based solution that processes both online and manual payments on your computer, generating receipts that can be emailed or printed. This includes a web-based virtual terminal, payment gateway with API, support for recurring billing, billing information vault storage, e-invoicing, shopping cart integration, and hosted payment pages. No additional hardware or software is required. Best of all, you get all these features for a flat $25.00 per month fee.

Mobile payments are supported through the free VirtualMerchant Mobile app for iOS and Android. To use the app, you’ll need the Helcim Mobile Card Reader, which supports magstripe swiping and plugs into your smartphone’s audio jack. Readers cost $30 each. There’s also a flat $12.00 monthly fee for an unlimited number of users.

Helcim uses a Cost+ pricing model, which includes a monthly subscription fee and interchange-plus pricing for each transaction. Retail users pay $12.00 per month, while eCommerce users pay $25.00 per month for the Helcim Virtual Terminal service. Support for mobile payments requires a $12.00 per month subscription. In addition to the per-transaction interchange rate charged by the issuing credit card company, Helcim charges 0.18% + $0.08 per transaction over the interchange rate for retail and mobile payments. Online transactions are charged 0.36% + $0.25 per transaction, plus the applicable interchange rate. Helcim doesn’t charge fees for account setup or termination, and PCI compliance is included in the monthly subscription fee. Helcim’s website includes a detailed explanation of their fees, plus some truly eye-opening disclosures about how their bank-owned competitors are ripping you off with hidden fees and long-term contracts.


  • Extremely transparent fee structure
  • Excellent customer support
  • Very competitive rates for businesses processing over $2,500 per month


  • Not suited for very small businesses processing less than $2,500 per month
  • eCommerce rates are higher for Canadian customers

For more information, see our complete review here.

Payline Data

Payline Data (see our review) covers all the bases for small business transactions, from mobile and online payments to in-store sales. They offer easy-to-understand pricing plans that are very affordable, especially for low-volume sellers. However, the company’s website fully explains all of the extra features and their associated costs, so you know up front what you’ll have to pay. Payline also stands out from the crowd for their corporate philosophy of charitable giving and support for non-profits through discounted pricing and their “Commercial Co-Venture” program.

The company offers four standardized pricing plans, all of which feature interchange-plus pricing and come with free hardware and software to get you up and running in no time. A standard feature of all four plans is a virtual terminal that allows you to process credit card transactions from any Internet-connected computer. Transactions can be keyed in manually or swiped with an optional USB card reader. All plans also feature month-to-month billing with no long-term contracts and no early termination fees. These are great terms, but be aware that these plans also come with a $25.00 monthly minimum.

For brand-new or mobile businesses, Payline Start is the most affordable plan. There’s no monthly fee, and processing rates are set at interchange + 0.50% + $0.20 per transaction. In addition to the free virtual terminal, you’ll also receive a free Ingenico GX5 card reader and the Payline Mobile app to go with it.

If you’re looking for value, but want better equipment and lower rates, the Payline Surge plan might be right for you. This plan includes the same features as the Payline Start plan, but upgrades your free card reader to an EMV-compliant Ingenico RP457C model. The plan costs $9.95 per month, and rates are set at interchange + 0.30% + $0.20 per transaction. Mobile businesses and small to medium retailers will benefit the most from this plan.

For larger retailers, the Payline Shop plan offers more bells and whistles. Instead of having to rely on a mobile processing solution, it includes a free countertop credit card terminal (either the Verifone Vx520 or the Ingenico iCT220, both of which are EMV-compliant and support NFC payments). You’ll also get free access to the Payline Gateway, the company’s proprietary payment gateway. This plan is a good fit for medium-sized retail businesses and omnichannel merchants who have both a retail and online presence. For larger businesses, Enterprise pricing is also available. Payline Data doesn’t disclose details about this pricing option on their website, so you can expect that processing rates, fees, and included equipment will all be negotiable. Expect to pay a significantly higher monthly fee in exchange for discounted processing rates.

If you’re in the eCommerce sector, the Payline Connect pricing plan is designed for you. You’ll receive both the virtual terminal software and free access to the Payline Gateway. There’s no monthly fee, and processing rates are interchange + 0.65% + $0.20 per transaction. This is a great plan for online merchants, especially those who are just starting out and want to keep their fees as low as possible.


  • Fair pricing with easy-to-understand contracts and no hidden fees
  • Excellent customer service, including phone and email support
  • Integrates with Apple Pay and other mobile wallet services
  • Month-to-month contracts with no early termination fees


  • Currently only available in the United States

For more information, see our complete review here.


Finally, there’s Square (see our review), the oldest and possibly most well-known company in the mobile payments industry. It’s important to note that although Square will allow you to process credit card transactions and run an eCommerce website, it doesn’t provide a full-service merchant account. Because of this, you won’t get a unique Merchant ID number or the kind of 24/7 customer service that typically comes with one. While it’s still an excellent choice for startups and smaller businesses, it’s a little too limited for larger, more established merchants.

Square was the first company to offer smartphone-based mobile payments when it launched back in 2009. Today, it has plenty of competitors, but its lack of a monthly fee, reasonable transaction fees, and robust features still make it a great choice, especially for low-volume sellers. Square replaces the traditional credit card terminal with a simple dongle that attaches to your smartphone or tablet and works in conjunction with Square’s mobile app to swipe credit or debit cards. Square supports retail locations, eCommerce, and (naturally) mobile payments.

The heart of Square’s system is its family of credit card readers. Square’s original card reader was free, but it could only read magstripe cards. While it’s still available, most users will want to get the new, EMV-compliant reader. Like the original reader, it plugs into the headphone jack of your smartphone and works in conjunction with the Square app. At only $29.00, it’s one of the more affordable EMV card readers available. Square also offers an upgraded card reader that reads EMV-enabled cards and supports uses NFC technology to support contactless payments such as Apple Pay, Android Pay, and others. The Square contactless reader communicates with your smartphone or tablet using Bluetooth and costs $49.00.

Square account holders can also access the Square Dashboard, available online or via the Square Dashboard mobile app. This free service features a host of powerful features to manage your business, including inventory management, invoicing, and detailed analytical data.

Square’s simple pricing structure is one of its most attractive features. Every credit or debit card swipe incurs a 2.75% fee. If the transaction has to be entered manually, the fee increases to 3.5%, plus $0.15 per transaction. Funds are deposited into the user’s account within 1-2 business days, unless fraud is suspected.

Unfortunately, one of the downsides to using Square is that fraud frequently is suspected, at a rate that’s well above the industry average. This often results in sudden, unexplained account terminations and account holds of up to 180 days. There are multiple reasons for this, but one major factor is that Square accounts are aggregated together, rather than each account having its own unique Merchant ID number. To make matters worse, Square’s customer service hasn’t always been the best. Originally lacking any kind of phone support, Square has gradually improved in response to user complaints, and now offers both email and phone support. Their online knowledge base for self-help is also excellent.

To use Square, you’ll need to set up a free Square account, get a compatible card reader, and install the Square Point of Sale app. The mobile app requires either an iPhone, iPad or iPod touch running iOS 9.0 or higher, or an Android phone or tablet.


  • No monthly account fees
  • Free and low-cost card readers available
  • Free access to powerful business management and analytical tools via the web or smartphone app
  • No long-term contracts or early termination fees


  • No unique Merchant ID number for merchant accounts
  • Frequent account holds and account terminations

For more information, see our complete review here.

Final Thoughts

Whether you’re trying to juggle multiple retail locations or just selling products online, one of the five services we’ve highlighted here should be a “best match” for your business. While each service has its own standout features, they all offer competitive rates, transparent pricing, and an easy, low-cost setup. Square is a solid contender for very small, low volume businesses, while Payline, Helcim, and CDGcommerce are better for larger retail establishments. If you’re running a non-profit, Dharma may very well be your best choice. In any event, all of these services will, in most cases, provide you with a better, more affordable service than you’re likely to get with any of the traditional, bank-owned credit card processing companies. You can also compare our top processors (except for Square) head-to-head using our Merchant Account Comparison Chart.

The post The 5 Best Small Business Credit Card Processing Companies appeared first on Merchant Maverick.

 Merchant Maverick Blog