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Last Updated: 11. June 2018

Card Payment Machine for Small Business in the UK - 2018 Guide

How a Card Payment Machine for Small Business Works

A card payment machine, also known as POS terminal, credit card terminal, PDQ machine or EFTPOS terminal, is a device that allows businesses to process payments electronically.

PDQ machines connect to a payment provider network via landline or internet connection. After the network authorises the card, funds can be transferred to the merchants accounts.

Typical features of the card payment machines for small business include:

  • ePOS (electronic point of sale) / mPOS (mobile point of sale) integration

  • Chip reader

  • Keypad for pin authorisation

  • Receipt printer

Whether you are a big retailer or an independent merchant, accepting card payments from your customers has many benefits. A credit card payment machine for small business can increase sales and ensure all payments from customers are received directly. However, there are some things to consider before going through the setup of a credit card payment machine. This 2018 guide contains all information you need to choose the best card payment machine for small business.

If you need professional advice on finding the best card payment machine for small business, Market Inspector can provide you with our complimentary service. Just fill in the contact form and get up to four completely free, non-binding quotes tailored to your business.

What You Will Learn about Card Payment Machines for Small Businesses in This Article

Does Your Small Business Need a Card Payment Machine?
Pros and Cons of Card Payment Machine for Small Business
How Much Does a Credit Card Machine for Small Business Cost?
What Type of Card Payment Machine Does Your Small Company Need?
Review of the 5 Best Card Payment Machines for Small Business
How to Find the Best Card Payment Machine for Small Business in the UK?

Does Your Small Business Need a Card Payment Machine?

Yes. In this dynamic and technologically advanced world, credit card machines for small businesses are a tool that business owners need to use and rely on frequently. Taking credit card payments using credit card processing terminals have become a widely popular, and often the expected payment method.

As we think about chip and pin solutions in the context of a card payment machine for small business, there are some factors to consider in order to evaluate the necessity of a credit card machine. Sometimes disadvantages may outweigh the potential benefits if the business is really small. In fact, 49% of small businesses in the UK still prefer not to take card payments.

Calculating Costs

Barcleycard Research recently published a study that shows four ways how not taking card payments can impact your business.

  1. 32% of people consider walking away from a purchase if it can not be done by card. Many people carry very little or no cash at all. On an average day, 37% of people will have less than £10 in their pocket.

  2. Almost 1 in 5 customers would choose to buy from somewhere where there is option for contactless payment.

  3. 41% of people would get frustrated if they cannot pay by card, while 43% would even have a lower opinion of that business.

According to a study from the The UK Cards Association, using debit and credit cards for payment has more than doubled in the past 10 years. It clearly shows how online retail has driven a change in the way consumers pay.

The growth in the number of card transactions in the past ten years has outstripped the rise in the amount spent, showing consumers’ growing preference for using cards for even lower value payments. The report also says that we can expect the increasing use of contactless and mobile payment, particularly by younger people who will be the major source of growth for card payments which will have an impact on the future of payments in the United Kingdom. Contactless card payments are almost 25% faster than other mobile credit card machines and transactions below £30 are approved within seconds.

Mobile Payment Machine

Pros and Cons of Card Payment Machine for Small Business

Using card payment machines as a small business owner offers some unquestionable advantages. It does not only expand purchasing options for your customer but it is also easier, faster, and safer than ever. Card payment machines for small businesses also opens the door to a more flexible way of taking payments where no cash handling is necessary, and making it impossible to give the wrong amount of change.

However, there are some potential drawbacks we should also consider. Accepting credit card payments means that you have to take on additional fees to operate your business and extra work to keep track and balance of these payments. Finally, the personal and financial data can easily be compromised if the payment taking process is not supported by solid security features. In this unfortunate case, it is often the merchant who loses out.

Pros and Cons of Accepting Credit Card Payments
AdvantagesDisadvantages
Faster and safer payments Additional charges for the payment terminal and transaction processing service
Impossible to give the wrong amount of change Possible one time startup fee
No cash handling is necessary Card-not-present transactions require an introduction of extra steps for verifying the identity of the cardholder
Offering different payment methods might increase the profit because it helps to tap into different markets May be cost ineffective unless it affects the business and customers need it
Online and phone payments become available which rise the flexibility by offering purchases outside business’ working hours When fraudulent transactions occurs, it is often the merchant who loses out
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How Much Does a Credit Card Machine for Small Business Cost?

There are three types of fees you need to understand and consider when you invest in a card payment machine for your small business. Apart from the cost of the machine itself you have to count on additional transactional fees and minimum monthly spend.

The Card Payment Machine

Depending on your budget, you can either rent a card payment machine for your small business or purchase it outright. The latter will likely pay off in the long run, while renting as part of the merchant account can save you money upfront.

Card machine rental can cost around £20-30 per month, while buying one outright requires an investment of £100-300.

Transaction Fees

The transaction fee amount depends on the type of payment card. While you are only charged 1% for debit card payments, it can be around 2% for credit cards. On top of that, the authorisation fee is a fixed 2-4p per transaction.

Minimum Monthly Spend

Your minimum monthly spend is the minimum amount of fees you will pay monthly regardless of the processed transactions. Therefore, it pays for smaller businesses to choose a contract with lower minimum spend in order to avoid unnecessary costs.

Countertop Payment Machine

What Type of Card Payment Machine Does Your Small Company Need?

There's a wide range of card payment machines for small business available on the market, therefore it is important to pick equipment that is right for your small business and is also a good fit with the nature of the service. After considering a number of factors including cost, payment options, and functions, you can choose between countertop, portable, and mobile payment machines.

Generally, there are four types of payment options: chip and pin reader, contactless, mobile credit card machine (also called smartphone & smartwatch), and credit card swipe machine.

Most mainstream or smaller banks support and ensure the availability of this functionality with their modern credit card design. It is becoming even more widely recognised to have at least several of these modes available within the business premises since most credit cards already support these technologies.

Countertop Payment Terminal

These are possibly the most common and best credit card machines for small businesses. This works well with small businesses which have only one physical point for transactions to process credit cards rapidly and efficiently.

The reason it is countertop is because the terminal is connected electronically to the merchant account provider, normally via telephone or ethernet line. The most common are chip and pin readers and as magnetic credit card swipe machines. Customer details are recorded and transaction is processed via the card machine provider, which forwards the funds to the merchant’s account.

Great for businesses such as: coffee shops, beauty salons, spas, and newsstands

Portable Card Payment Machine

Portable Payment Device

This type of terminal is similar to the countertop type, but with the difference that it can be moved around. Portable credit card machines can be used within your small business' premises and works well in hospitality industries such as a restaurant, where payment takes place at the customer’s table.

Such types credit card machines are connected to a Bluetooth signal which works between the terminal and a payment portal. Additional functions, such as the option for adding gratuity to the bill, can be set up to meet the requirements of the service.

If one owns a small bar, having a portable credit card machine help you to serve your guests in a more effective manner. Creating a single tab helps to retain customers by offering them payment at the table instead of forcing them to go to the bar each time they want to order something.

Great for businesses such as: bars, restaurants, and cafes.

Mobile Payment Machine

A mobile credit card machine is supported by the GPS connection, nevertheless, it can sometimes be mistaken for a portable credit card machine because both run on wireless networks.

Mobile credit card machine has an add-on attached to the device (phone or a tablet) and works via a card reader app. It is a particularly good card payment machine for small businesses which do not have a single set location. Note that providers which offer a wireless account are slightly different from the regular merchant accounts because they are able to set up a service for you much faster.

Great for business such as: food truck vendors, cab services, and pop-up shops.

Chip and Pin Payment Machine

Review of the 5 Best Card Payment Machines for Small Business

Whether you are looking for a countertop, portable, or mobile payment machine, one the following five card payment machines for small businesses will make it easier than ever to accept payment by card.

iZettle

iZettle

The iZettle card reader has quickly become one of the most popular card payment machines for small businesses. Its competitive price was designed specifically for lower volume and can be also used for online selling via iZettle e-commerce.

Key features:

No fixed monthly cost

  • Battery life for up to 8-hours or 100 transactions

  • Accepted payments: chip and pin, contactless, and magstripe compatible with Apple, Android, and Samsung pay

  • Connects to your mobile phone or tablet via Bluetooth

  • Works together with its dedicated free point-of-sale app

  • UK based support available

  • Taking payment only take seconds

It is a good solution for you if: you are looking for the least expensive and most popular option on the market.

SumUp

SumUp

SumUp is a great card reader for companies that work with lower volume of transactions as it offers flat and simple transaction fee. Even though SumUp is a less known payment terminal brand, it has become more well known recently, and is currently being the best alternative to iZettle card payment machine for small businesses.

Key features:

  • Battery life: up to 8 hours

  • Accepted payments: credit and debit cards, chip & pin or magnetic swipe

  • No fixed monthly costs and flat transaction fee

  • Works with an online application

  • Card reader connects to phones and tablets via Bluetooth and is compatible with both iOS and Android

It is a good solution for you if you just got started and process a lower volume of transactions.

PayPal Here

Paypal Here

Paypal Here is a credit card machine solution from Paypal, one of the best known online payment services from Elon Musk, founder of Tesla and SpaceX. The terminal will almost automatically connect with your Paypal account and will allow you to access your fund right after an approved transaction.

Key features:

  • Accepted payments: card and contactless payment

  • UK based support

  • No monthly fees and fixed contract

  • Compatible with Apple pay and Android pay

  • Payment quickly arrives to your Paypal account

It is a good solution for you if you already use Paypal services.

Square Inc

Square

Although Square is relatively new in the UK, it has quickly become the second most popular provider of card payment machine for small business in the UK after iZettle. Square’s CEO, Jack Dorsey also co-founded Twitter, and both businesses are booming.

Key features:

  • Accepted payments: chip and PIN card, contactless card and mobile payment.

  • Comes with a free point-of-sale app that is compatible with Apple and Android devices including both Smartphones and Tablets

  • Can also be used to sell online, by phone and collect payments via invoices

It is a good solution for you if you are planning to use it only as card machine for your small business. You will get one of the best rates with less restrictions.

WorldPay Zinc

WorldPay Zinc

Worldpay is the UK’s biggest credit card processing company, which has introduced the Zinc model. The Worldpay Zinc model is tailored to offer card payment machines for small businesses by reducing its features to only the essentials. They do not wish to compete with a traditional card payment machine for small business. One big advantage of Worldpay Zinc is that it handles both in person and phone payments.

Key features:

  • Accepted payment: credit or debit card supported by Maestro, Visa or MasterCard

  • Compatible with iPhone, iPad, Android phones & tablets

  • Comes with a 12-month warranty

It is a good solution for you if you are searching for a fee structure that does not require any commitment or long-term contract or if you wish to accept phone payments.

Review of Card Payment Machines for Small Business
Card payment machinesTransaction FeeMachine costAdd ons
iZettle 1.75% £59 + VAT The app includes:
Stands & Docks Receipt Printers Barcode Scanners Cash Drawer Store Kits
SumUp 1.95% £59 + VAT No official add-on products
Paypal Here 2.75% £75 (incl. VAT) Taxi Cab Bundle
Bouncepad
Retail Stands
Fast Charge Cradles
POS desk stands and mounts
Square 1.75% £39 + VAT Track employee performance
Inventory management
Sync with other apps and softwares
Worldpay Zinc 2.75% with no monthly fee 1.95% with £5.99 a month £39.99 (incl. VAT) Phone payment via the app

How to Find the Best Card Payment Machine for Small Business in the UK?

Before you choose a card payment terminal, you need to compare offers from UK’s leading providers of card payment machines for small business in order to find the most suitable product for your business.

Simply fill in this form contact form on the right and we will provide you with four totally free, no-obligation quotes tailored to help you find the best card payment machine for your small business.

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