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6 Best Credit Card Processing for Small Businesses in 2023

Emma Ayres Emma AyresFinance Specialist November 18, 2022
November 18, 2022
It’s not easy finding the right credit card processing company for your small business. With multiple types of payment models on the market, it can be difficult to know which one is best for you. Plus, very few small business merchant services publicly advertise their rates, making it even harder to draw an accurate comparison.

Not every small business is the same, either. Your transaction volume, where and how you sell, and even what Point of Sale (POS) hardware you already have will all impact which credit card processor will benefit you. If your small business is relatively new, you’ll also want the flexibility to try out card processors without being locked into a contract.

Having researched dozens of services, I’ve compiled a list of the best credit card processing companies for small businesses. Whether you’re looking to grow your business or just want to find a better payment processing deal, keep on reading for my recommendations.

Short on Time? These Are the Best Credit Card Processors for Small Businesses in 2023

  1. Stax – Subscription-style payment model offers significant savings for small businesses with high-volume transactions.
  2. Payment Depot – Affordable subscription-style pricing for budget-conscious small businesses.
  3. Leaders Merchant ServicesA no-frills processing service with free Clover POS hardware.

See 3 More Great Options | Comparison Table | FAQ

What We Look For in the Best Credit Card Processors for Small Businesses

While I was researching credit card processing companies for this list, I focused on certain features that would directly benefit small businesses.

  • Free or discounted terminals. Getting a free or discounted terminal means there’s more money in the budget to invest in your business. Every card processor on this list helps you start selling in person for little to no extra cost.
  • Quick approvals. These credit card processors have a quick application process and aim to approve every eligible application within 48 hours. This means you’re not waiting around and potentially losing business.
  • E-commerce support. With many small businesses selling both in-person and online, you’ll need a payment processor that offers e-commerce support. Whether that’s integration with popular e-commerce platforms or virtual terminals, these features make sure you never miss a sale.
  • No or low monthly minimums. Given how volatile small business incomes can be, I’ve avoided including payment processors on my list that charge a high minimum monthly processing fee.

Stax summary
Take payments anywhere with Stax’s virtual terminal, mobile app, and POS hardware
Stax’s payment model makes it perfect for high-volume small businesses. There’s no markup on interchange fees, with Stax charging just 0% + 8¢ (in-person) per transaction. Plus, Stax’s monthly fee includes its fantastic software suite, which provides analytics, an online merchant portal, e-commerce integrations, and more.

While there are some other fees involved, such as chargeback fees, Stax can save your business up to 40% when compared to its competitors.

In addition, Stax aims to approve accounts within 24-48 hours, so you won’t need to wait long to start accepting payments.

With that being said, Stax won’t suit every business. It doesn’t accept high-risk merchants, and you’ll need at least 3 months’ credit card processing history to apply. But if you process a lot of transactions each month, the financial benefit of Stax’s fixed monthly fee and wholesale interchange rate will deliver savings quickly.

Features and Benefits

  • Free terminal. As a Stax customer, you’ll get a free Dejavoo, PAX, or Swipe Simple terminal depending on your business needs. There are no additional monthly costs, but you’ll have to return your terminal if you cancel your Stax account.
  • Thousands of integrations. Stax integrates with most popular e-commerce platforms and, by using Zapier, you can connect Stax to almost any other app. Stax’s QuickBooks integration allows you to automate your accounting to save a ton of time.
  • POS device integrations. If you’re already using POS devices, you don’t have to worry about switching your entire hardware suite. Stax offers free integration with over 90% of third-party POS devices.
  • Month-to-month contracts. Stax doesn’t lock you into lengthy contracts or charge an early cancellation fee. If Stax doesn’t work for your business, all you need to do is give 30 days’ written notice.
Read our expert Stax review for more great features for small businesses.

Free terminal
E-commerce features
  • Built-in e-commerce platform
  • One-click shopping carts
  • E-commerce integrations
  • Virtual terminals
Contract length Monthly with no early cancellation fee
Transaction fees on cheapest plan 0% + 8¢ (in-person)
Monthly subscription on cheapest plan $99.00

Payment Depot summary
Payment Depot uses a subscription-style payment model to save you money
As a subsidiary of Stax, Payment Depot offers many of the same e-commerce solutions and a brilliant subscription-style payment model – but for less. Payment Depot’s plans start at $59.00/month so you’ll still be able to save money on your credit card processing even if your business isn’t large enough to justify one of Stax’s more expensive plans.

Similar to Stax, Payment Depot gives you access to wholesale interchange prices – plus a low transaction fee. You’ll also get a free Dejavoo Z11 terminal to save you money from the start.

With month-to-month contracts and no early termination fees, it’s worth giving Payment Depot a try. With cheaper monthly plans than Stax, smaller businesses with strict budgets have the chance to benefit from a subscription-style processor. Just be aware that, if you cancel your contract, there’s a 20% restocking fee on any equipment you return.

Features and Benefits

  • Next-day deposits. You’ll get paid within 24 hours of every transaction, regardless of the payment method. While there’s no option for same-day payouts, 24 hours is still quicker than the majority of card processors.
  • 24/7 risk monitoring. Payment Depot’s risk monitoring team reduces your risk of fraud and chargebacks by proactively notifying you of potential problems before they occur. By keeping up to date with the latest fraud methods and bank policies, Payment Depot works hard to keep your money safe.
  • Discounted Clover terminals. Clover’s POS solutions are largely considered the best of the best, and as a Payment Depot customer, you’ll get a discount on these products. Just bear in mind that you’ll have to pay an extra monthly fee to use Clover’s software.
  • Quick setup. Whether you’re applying online or over the phone, signing up with Payment Depot only takes a few minutes. As long as you’ve provided all the necessary documentation, you can usually start accepting online payments in as little as 24 hours.
Learn how your business can save money in our Payment Depot review.

Free terminal
E-commerce features
  • Built-in e-commerce platform
  • One-click shopping carts
  • E-commerce integrations
  • Virtual terminals
Contract length Monthly
Transaction fees on cheapest plan 0% + 8¢ (in-person)
Monthly subscription on cheapest plan $99.00

3. Leaders Merchant Services: For Growth-Focused Small Businesses

Leaders Merchant Services summary
Leaders Merchant Services offers good core features to help your business grow
Leaders Merchant Services (LMS) helps small businesses grow thanks to its fantastic core feature suite. Not only can you get a free Clover device depending on the length of your contract, but you’ll also get the popular Authorize.net payment gateway to handle card-not-present transactions.

While LMS offers competitive (and negotiable) rates, you need to be aware that there are some additional fees. You’ll be charged for PCI compliance and early termination fees. You’ll also have to pay extra to use Authorize.net’s virtual terminal. Even so, with a low monthly fee of just $9.00, LMS is a highly affordable option for lower-volume businesses – freeing up money in your budget to invest back into your business.

Features and Benefits

  • Business funding. LMS offers merchant cash advances, which you can repay through a small commission on future sales. This allows you to avoid the risk of putting up collateral while still accessing the funding you need to grow.
  • 96% approval rate. As long as you’re not a high-risk business, there’s a good chance you’ll be approved by LMS. It only takes a few minutes to apply, and the approval process can take as little as 24 hours.
  • Customized services. Depending on your business and industry, you’ll be able to access additional services like subscription tools, loyalty programs, gift cards, online menus, and more.
  • 24/7 phone support. Unlike other providers, LMS provides round-the-clock customer service to solve any payment processing issues that might arise.
Read our expert Leaders Merchant Services review for more great features.

Free terminal Yes, depending on contract length
E-commerce features
  • Payment gateway
  • Virtual terminal
  • Shopping cart integration
Contract length 3 years average (open to negotiation)
Transaction fees on cheapest plan Around 2% + 0¢
Monthly subscription on cheapest plan $9.00

Flagship Merchant Services summary
Flagship Merchant Services offers payment solutions for almost every business
Flagship Merchant Services is remarkably easy to set up. Unlike other processors that require documentation, Flagship has a simple application process only asks a few questions about your business. Merchant accounts are typically approved within two business days, and you can start processing payments on the next business day.

Once you’re accepted, you’ll get a “free” terminal. Depending on what you’ve negotiated with Flagship’s sales team, this will be either a Clover Mini or Verifone VX 520. Unfortunately, it won’t be entirely free – you’ll likely be charged a small insurance and maintenance fee while you have the equipment.

Still, this equipment isn’t cheap to purchase outright, particularly if your business is brand new and you don’t have a lot of budget to spare. Plus, with month-to-month contracts and no early termination fees, Flagship offers a good starting point for brand new businesses.

Features and Benefits

  • Same-day funding. Flagship can help keep your business afloat with its same-day funding option. There’s no information about how much this service costs, so you’ll need to contact a sales representative for a custom quote.
  • iAccess Business Management Portal. You can keep an eye on all aspects of your business with this software suite. Use it to see sales summaries, generate financial statements, analyze your business’s growth, and more.
  • 24/7 support. In addition to a dedicated account manager that operates during business hours, you’ll get 24/7 phone support for time-sensitive technical issues.
  • Custom merchant account solutions. With Flagship, you only have to pay for the card processing features you actually need. By negotiating rates, features, and pricing structures with your sales agent, you can make sure everything is set up in a way that benefits your business.
Read our Flagship review to see how it can help your new business.

Free terminal
E-commerce features
  • Payment gateway
  • Virtual terminal
  • Shopping cart integration
Contract length Monthly
Transaction fees on cheapest plan 1.58% + 19¢ (in person)
Monthly subscription on cheapest plan $7.95

5. Luminous Payments: For Small Brick-and-Mortar Businesses

Luminous Payments summary
Luminous Payments gives you more flexibility in how you pay for credit card processing
With a lot of processors focusing on e-commerce, Luminous Payments makes sure brick-and-mortar stores aren’t being left behind. It offers full POS systems, including cash registers, which isn’t something I regularly see among payment processors. You’ll also get a free Bluetooth card reader for NFC and swiped transactions.

Brick-and-mortar stores can also benefit from Luminous Payments’ Cash Discount program. Provided you meet legal requirements, this lets you pass on per-transaction processing fees to card-paying customers by applying a markup to all your products and offering a discount to anyone paying with cash.

While you do get some e-commerce features like a payment gateway, a virtual terminal, and shopping cart integrations, they’re somewhat limited compared to other providers. With that being said, if you run e-commerce alongside your brick-and-mortar business, you’re likely to find that the included NMI e-commerce gateway offers enough functionality to support your online store.

Features and Benefits

  • Flexible pricing models. If the Cash Discount payment model doesn’t work for your business, there are 3 other options to choose from: flat rate, tiered rate, and interchange-plus. You can also negotiate a custom pricing model to suit your business.
  • Free POS reconfiguration. Luminous Payments will reconfigure your existing POS hardware for you – provided that it meets modern security standards and isn’t proprietary to a particular payment processor.
  • Guaranteed Savings Program. If you make a switch, Luminous Payments guarantees it’ll save you money on your overall processing costs. If it can’t, it’ll pay you $1,000.
  • Next-day funding. You’ll receive your money within one business day. You can also pay an extra $10/month for same-day funding.
Read our Luminous Payments review to see how it can support your small business.

Free terminal
E-commerce features
  • Payment gateway
  • Virtual terminal
  • Shopping cart integrations
Contract length Variable
Transaction fees on cheapest plan 1.59% + 5¢
Monthly subscription on cheapest plan $10.00

6. CreditCardProcessing.com: For Advanced Small Business Solutions

CreditCardProcessing.com summary CreditCardProcessing.com’s flat-rate pricing makes it a good choice for small businesses. Operating in a similar way to Stax and Payment Depot, this flat-rate pricing gives you access to modern software and a 0% interchange-plus markup.

It’s best for high-volume businesses, as the more transactions you process, the lower your transaction fee will be. Keep in mind that businesses that rely on high volumes of low-ticket sales aren’t likely to see any significant savings due to the high transaction fees on less expensive plans.

Each CreditCardProcessing.com account has access to Vindicia, which allows you to set up recurring payments and provides analytics to help you optimize your plans. Vindicia Retain can turn up to 30% of failed transactions into successful payments.

Features and Benefits

  • Free terminal. You can get a free Pax A920 terminal if you commit to a 1-year contract, or a free Clover Mini if you sign up for the High Volume plan. Bear in mind that using Clover’s software comes at an additional cost.
  • High approval rate. CreditCardProcessing.com is happy to accept businesses with low credit scores and boasts the highest approval rate of any US credit card processor.
  • Free training. If you’re not sure how to use your included POS terminal or e-commerce solutions, CreditCardProcessing.com offers free training to help get you up and running.
  • Data breach protection. If you suffer financial losses because of a data breach on CreditCardProcessing.com’s servers, you’re insured for up to $100,000.
Read our expert CreditCardProcessing.com review for more details.

Free terminal Yes, depending on contract length/plan
E-commerce features
  • Customizable checkout
  • Subscription management
Contract length Variable
Transaction fees on cheapest plan 0% + 30¢ (Starter)
Monthly subscription on cheapest plan $15.00

Finding the Best Credit Card Processing for Small Businesses

It’s difficult to name a definitive best credit card processing service for small businesses because every small business has unique needs. However, some credit card companies have a lot more to offer than others.

Stax is a good choice for high-volume small businesses. With free terminals, modern software, and a pricing structure that offers significant savings over traditional payment processors, Stax has a lot to offer.

If you don’t have the budget for Stax, go with Payment Depot. This processor is a subsidiary of Stax, so you’ll get many of the same features and software for a cheaper monthly rate.

Or, if you’d rather a no-frills service, Leaders Merchant Services is a great choice. You’ll get a free Clover POS device depending on your business needs, and you have access to cash advances if you need a boost for your small business.

Here’s a quick comparison of my top credit card processing companies for small businesses.

Best Feature Best For Monthly fee on cheapest plan Transaction fees on cheapest plan
Stax Thousands of e-commerce and software integrations High-volume businesses that need modern payment software $99.00 0% + 8¢ (in-person)
Payment Depot Next-day funding, regardless of payment type Small businesses that need a cheap card processing solution $59.00 0% + 8¢ (in-person)
Leaders Merchant Services Free Clover POS hardware (depending on contract length) Growth-focused small businesses that need a no-frills payment processing service $9.00 Around 2% + 0¢
Flagship Merchant Services Simple application process with high approval rates New small businesses that don’t have a lot of documentation $7.95 1.58% + 19¢ (in person)
Luminous Payments Multiple pricing models, plus custom pricing to suit your business Brick-and-mortar small businesses that handle cash transactions $10.00 1.59% + 5¢
CreditCardProcessing.com Advanced software to manage subscriptions and recover lost payments Small businesses with low credit scores $15.00 0% + 30¢ (Starter)

FAQ

What is the cheapest way to take card payments?

That depends on your business and its transaction volume. Stax offers significant savings for high-volume businesses. It charges a monthly fee with no markup on interchange rates, just a small flat transaction fee on each sale. However, low-volume businesses will likely find Leaders Merchant Services to be a cheaper option.

How do I set up credit card payments for my small business?

To set up credit card processing for your small business, you’ll have to apply for a merchant account with a credit card processor. Some processors will ask for bank documentation, processing history, and proof of identity. If you can’t fulfill all of these documentation requirements as a small business owner, Flagship Merchant Services is a great option.

Can small businesses charge for card payments?

Surcharging for credit card payments, or adding convenience fees, is illegal in 10 US states. Elsewhere, small businesses can add a surcharge, but they can’t apply this to Visa or Mastercard debit cards. They must register this surcharge with the payment network, display a notice of surcharge at the point of sale, and include the surcharge on the sales receipt. You’ll also need to use a payment processor that supports surcharging, which many of our top 10 credit card processors in 2022 do

How can I accept credit card payments without a machine?

To accept card payments without a machine, you’ll need to use a payment gateway or virtual terminal. Both of these software tools are an affordable option for small businesses that don’t have the budget to lease or purchase a terminal. Stax’s proprietary payments software is a great option. However, if you don’t have the budget for one of Stax’s plans, I recommend Payment Depot – this processor uses the industry-leading Authorize.net terminal, and it’s included in your monthly fee.

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