Small businesses have three main ways to accept credit cards. Flat-rate apps like Square are easiest to start with but cost more as you grow. A merchant account with interchange-plus pricing usually costs less once you process tens of thousands a month. Dual pricing or surcharging, where allowed, cuts fees the most because customers who pay by card cover the cost. The right choice depends mostly on your monthly card volume.
Key takeaways
- Flat-rate apps (Square, Stripe) are simplest and best for new or small businesses.
- Merchant accounts on interchange-plus pricing usually win once volume grows.
- Dual pricing or surcharging can cut fees 55% to 98% where allowed.
- Judge every option by your effective rate: total fees divided by card sales.
- We help with both paths: Square for starters, a better setup plus free marketing at $100K+ a month.
The three ways to accept cards, compared
| Flat-rate app | Merchant account | Dual pricing / surcharging | |
|---|---|---|---|
| Examples | Square, Stripe, PayPal | A processor on interchange-plus or tiered pricing | Added to a merchant account, where allowed |
| Typical cost | About 2.6% + 15¢ in person, 2.9% to 3.5% online or keyed | Often 2.2% to 2.6% all-in for card-present sales | Most of the cost moves to customers paying by credit card |
| Setup | Minutes, no contract | Application and underwriting, a few days | Set up by your processor; signs and receipts required |
| Best for | New businesses and low volume | Established businesses with steady volume | High-ticket and invoice businesses that want the lowest net cost |
Flat-rate figures reflect published pricing as of October 2026. See our Square vs. Stripe vs. Clover fee comparison for exact rates.
Which option fits your business size?
- Just starting or under about $20,000 a month: a flat-rate app is usually the simplest, cheapest-to-start choice. Our Square starter option gets you set up through our processing partner and adds a free website and Google Business Profile ($5,000 value).
- About $20,000 to $100,000 a month: compare a merchant account. The savings over flat-rate pricing start to add up, especially if you take business cards or large invoices.
- $100,000+ a month: a merchant account on interchange-plus pricing, plus dual pricing where allowed, usually costs far less. Switching through us also comes with a free $10,000 marketing package.
What it really costs: an example
Take a business doing $100,000 a month in card sales:
| Setup | Approximate monthly fees |
|---|---|
| Flat-rate app at about 3% blended | About $3,000 |
| Merchant account at 2.4% all-in | About $2,400 |
| Dual pricing, where allowed | Often a few hundred dollars or less |
Illustrative only. Your numbers depend on card mix, average ticket and how you take payments. In one published case, an event services company went from $3,713 to $91.42 a month with dual pricing.
Get your own numbers in 30 seconds with the credit card processing fee calculator.
How to choose a processor
- Know your effective rate today, using your last statement.
- Ask for interchange-plus pricing once you're past startup volume.
- Check for contracts and junk fees: early termination, monthly minimums, PCI and annual fees.
- Make sure it works with your software for invoicing, point of sale and your industry tools.
- Ask about dual pricing or surcharging and confirm the credit card surcharge laws by state.
Our full checklist is in how to choose a merchant services provider.
How we help small businesses
We're a marketing company that works with an established processing partner. Send a recent statement for a free fee review and we'll show your real rate and every option. Industry-specific advice is in our guides for HVAC, auto repair, dental, law firms and more.
Frequently asked questions
What is the best credit card processing for a small business?
How much does credit card processing cost a small business?
Is Square good for small businesses?
When should a small business switch from Square to a merchant account?
Can a small business avoid credit card fees completely?
Do I need a merchant account to accept credit cards?
This article is general information, not legal, tax or financial advice. Card network rules and state laws change; confirm the rules for your business before changing how you charge customers.