Which is the cheapest card reader for your business? By using a mobile card reader a business can revolutionise the way they take payments from customers and take advantage of the explosion in plastic payments. So finding the best deal on a card reader is a key issue facing today’s modern company.
We now pay by card at small retailers, bars, taxis, corner shops, and even the local Sunday markets and car boot sales. In the last ten years, we’ve come to use our cards so much that, if we offer to pay for something in a shop and they don’t accept a debit or credit card, it’s genuinely surprising.
The great news for businesses today is that there has never been so much choice in finding a company to provide us with the ability to transact by credit or debit cards. The companies are often called merchant service providers.
To find out the best card reader offer available on the market, we totted up the costs for a taxi driver taking £2,000 worth of payments a month from their passengers by card. There was just £34 between first place and fourth place. The fifth highest finishing option cost £363 more than the winner – proof that it does pay to shop around for the cheapest card reader.
Cheapest card reader available now
The award for best card reader for small business in our league table goes to the SumUp Air. Please see below for the top five choices of portable card reader in our most recent survey.
|Machine cost inc VAT||£35||£23||£35||£35||£54|
|Annual cost of monthly fees||£0||£0||£0||£0||£0|
|Contract length||Pay As You Go||Pay As You Go||Pay As You Go||Pay As You Go||Pay As You Go|
|Minimum sales pm||None||None||None||None||None|
|Cards and NFC accepted||Visa, Vpay, Mastercard, Maestro, American Express, Google Pay, Apple Pay||Visa, American Express, Visa, Apple Pay, Google Pay||Visa, Vpay, Mastercard, Maestro, American Express, Google Pay, Apple Pay||Visa, Mastercard, American Express, JCB, Diners Club, Union Pay, Contactless, Apple Pay, Samsung Pay, Google Pay, Discover||Mastercard, Maestro, Visa, American Express, Apple Pay, Android Pay|
|Settlement period||2-3 days||1-2 days||Immediate||2 days||2 hours|
|Total running cost||£440||£443||£455||£455||£474|
Best card reader table – what everything means
The companies handling credit and debit card payments on your behalf are referred to as merchant services providers and as payment gateways. Each of the merchant service providers on this page has their own integrated payment gateway which they provide to you as part of the service.
Your provider will send you the equipment to take cards and organise both the authorisation of customers’ payments and payment of those transactions into your nominated account.
Each of the machines (or terminals) use to take cards has its own brand name given to it by its provider.
There is a cost to each terminal – those costs are shown in the table above inclusive of VAT but excluding any postage and packing charge.
Although not shown on this page, other merchant service providers rent you a machine for which you will either make an upfront payment, a monthly payment, or both.
Annual cost of monthly fees
Some providers charge their customers a fee to keep their account open. In the table above, only iZettle does this. In the table, this monthly fee has been recalculated to express the amount you would pay over the course of a year including VAT.
Many merchant service providers require customers to sign up to their services for a minimum length of time. If you attempt to leave a contract before its agreed end date, you will likely pay a termination fee.
None of the five providers in this article imposes a minimum contract length on its customers. If you wish to give them notice, simply contact them and, in most cases, within 30 days, your account will close.
Minimum sales pm
There are no minimum sales volumes per month requirements placed on customers by the merchant services suppliers listed on this page.
If you turn over more than £250,000 per annum with card transaction, you should contact your merchant services provider to negotiate a better transaction percentage (more on that bellow).
Cards and NFC accepted
Merchant service providers permit payment via certain types of card via their systems – for example, Visa, Mastercard, and so on. In the table above, you see which cards and payment methods each provider processes.
Contactless payment means payment by showing your card to the terminal without inserting it and entering your PIN. This works using a technology called Near Field Communication (NFC).
All of the terminals in the table above accept contactless payment from cards, enabled smartphone, and enabled smartwatches.
With the exception of PayPal, most card transactions done face-to-face using contactless or chip & PIN payment are charged identically on each platform.
The charge is a percentage of the total transaction amount taken on one particular payment. So, if you were using SumUp whose transaction fee is 1.9% on a sale of £100 to a customer, the fee would be £1.90.
PayPal has the following scale of fees depending on the turnover you make in a calendar month:
|Monthly volume||Transaction fee|
|Up to £1,500||2.75%|
|£15,000 and above||1%|
The transaction percentages quoted are normally for consumer credit and debit cards issued with the UK or EEC. Commercial cards normally attract a higher charge as do non-EEC cards. You may have to pay a high percentage on American Express, Diners Club, and JCB cards.
Some of the merchant accounts allow you to take payment online, over the phone, via magswipe (magnetic swipe), or with manual key entry (where you enter the client’s details into the terminal). They will nearly always attract a higher percentage fee than the standard quoted rate.
For rate variations, please check the merchant service providers’ websites. Card payments are regulated in the UK by the Payment Systems Regulator.
The settlement period is the time it takes for a successful card payment to land in the bank account you nominate to receive it.
In the table above, the transaction charges column refers to fees paid by you for monthly rental and percentages on the £2,000 worth of sales you take each month over the course of a year.
Total running cost
The total running cost is the total transaction charges you pay plus the cost of the terminal.
1st place – SumUp Air
On a turnover of £24,000, SumUp Air would cost you £440.40 over the course of a year, equivalent to 1.84% of your turnover.
The SumUp Air is a small device that can easily fit in the pocket. The model features a long operating time as provided by the inset Li-ion battery, NFC communications, and Bluetooth connectivity.
For most transactions, the cost is 1.69% of the value on the receipt. Over-the-phone, online, keyed-in, and magswipe payments cost 2.95% + 25p. There is no monthly fee.
Link to SumUp Air card payment machine.
2nd place – Square Reader
Just behind the SumUp Air costing £2.40 more over 12 months, the Square Reader would cost you 1.85% of your turnover.
An elegant terminal little more than a white square box with four flashing orange lights to indicate power and connectivity, Square believe that you can get a full day’s busy use from one charge.
As well as no monthly fee, the charges are 1.75% of transaction value on face-to-face payments and 2.5% on cardholder-not-present payments – online ecommerce sales, keyed-in transactions, payments that were taken over the phone, and payments made as the result of an invoice.
Equal 3rd place – myPOS Go
Demonstrating the level of competition for the top spot between the main market participants, third place belongs to myPOS – they would take 1.9% of your turnover over the year.
Featuring a 2.4’ full colour screen, this portable and stylish terminal has an in-built PIN pad as well as the slots needed for chip & PIN and magswipe payments.
There is no monthly fee with myPOS. Cards are charged as follows –
|Contactless and chip and PIN||Transaction fee|
|Consumer cards issued with the European Economic Area||1.75%|
|Commercial cards issued within the EEA||2%|
|Non-EEA cards, American Express, Union Pay, and JCB||2.85%|
|Online and over the phone||Transaction fee|
|Consumer cards issued with the European Economic Area||2.25%|
|Commercial cards issued within the EEA||3.25%|
|Non-EEA cards, American Express, Union Pay, and JCB||3.5%|
Refunds are charged at 49p and disputes and chargebacks at £24.99.
Link to myPOS Go card payment machine.
Equal 3rd place – iZettle Reader
And in equal third place, the iZettle Reader…
11cm x 7cm x 2cm in size, the iZettle Reader is a sleek and stylish mobile payments terminal which should easily fit inside our purse, wallet, or pocket.
There are no monthly fees – cards are charged at 1.75%.
There is an e-commerce subscription available for £29 + VAT a month allowing you to take payments online. iZettle will even help you build a website using their online editor and hosting. Any sales made on the internet are charged at 2.5% (or 2% if PayPal is used).
Link to iZettle Reader card payment machine.
5th place – PayPal Here
In fifth place, is the international brand name and company which kicked off the payment processing revolution 20 years or more ago – PayPal, and they would take 1.98% of your turnover in fees.
A matt black and elegant square terminal featuring an integrated keypad and a rudimentary dot display, the Here contains slots for both magswipe and chip & PIN payments.
There is no monthly charge for using PayPal’s Here service. The transaction fee you pay will be based on your monthly volume following this structure.
|Monthly volume||Transaction fee|
|Up to £1,500||2.75%|
|£15,000 and above||1%|
PayPal requests that, if you take more than £250,000 a year in card payments, you get in touch so that you can negotiate better rates.
Link to PayPal Here card payment machine.
Choosing the cheapest card reader for your business
If you’ve never taken cards for your business before, we understand that it can feel like a big step. We hope that, on this page, we’ve explained some of the jargon and helped you understand better the choices available to you.
Finding a cheap card reader for your business will mean that you no longer have to turn customers away because they don’t have enough cash. Even better, you’ll find that your average order value goes up when you accept credit and debit cards – sometimes by up to as much as 83%.