Best Payment Processors
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If you run a retail business in 2022, you almost certainly take some sort of non-cash payment. According to the Pew Research Center, 34% of persons under the age of 30 do not make any cash transactions in a normal week. Business owners are increasingly required to comprehend and obtain payment processors to keep up.

What is a Payment Processor?

A payment processor is a company that handles the processing of credit and debit card payments. Payment processors transport card data between the many financial institutions that participate in the transaction and wherever clients enter their credit card information—card readers, checkout webpages, or even specialty gear attached to a smartphone.

Payment processors are also crucial in protecting online transactions. They not only ensure that consumer bank accounts have sufficient dollars or that credit cards have sufficient credit limits, but they also ensure that customers' sensitive financial information is protected from malicious third parties.

How Do Payment Processors Work?

When a business accepts card payments, the payment processor is the unseen actor who completes transactions by moving funds from the consumer account to the merchant account—often in the blink of an eye. The following is how it works:

1- Buyer gives card information

A customer gives their credit card details to a merchant. This could be done at a card reader in a physical store, on a website's checkout page, with mobile hardware, or with another payment method.

2- Payment infrastructure handles the request

The customer's credit card information is subsequently transferred to the payment processor via a payment gateway. The processor then formally launches the transaction by sending the data to the bank network (for debit) or card network (for credit) for authorization, such as Mastercard, Visa, or American Express. The payment processor is subsequently notified by the bank or card network whether the payment has been approved or denied. The merchant completes the transaction with the customer if the payment is approved. If the payment is denied, the consumer is notified and given the option to attempt another payment method.

3- The money moves

The payment processor notifies the bank or credit card firm that issued the customer's card (known as the “issuing bank”) that the money must be sent to the merchant's bank (known as the “acquiring bank”) once the transaction has been authorized and completed. Depending on the payment provider and the type of acquiring bank account, funds are transferred to the merchant's account (set up by a merchant services provider) instantly or within a few business days. The merchant can then transfer the monies to their company's bank account.

Best 5 Payment Processing Companies

Any business owner can choose from a large number of payment processors on the market. The following are 5 of the most popular services:


Square is one of the most well-known payment processors, with trademark white card terminals on the counters of your favorite coffee shops and a thumb-sized version plugged into someone's smartphone. It has a clean, basic, and easy-to-understand interface, which adds to its appeal. Square charges 2.6 percent plus ten percent for in-person purchases and 2.9 percent + thirty percent for online purchases. Square's software pricing may differ slightly depending on whether you use the free or subscription models. When you sign up for a plan, you get one free card reader; after that, hardware costs between $10 and $149.

Payment Depot

Clients of Payment Depot pay a $79.00 monthly membership fee. Payment Depot charges an additional flat cost after a purchase is made, with no markup on the interchange rate. Flat prices range from 15 cents per transaction for the cheapest monthly plan with the fewest features to 7 cents per transaction for the most expensive plan with the most features. Payment Depot is also compatible with some different hardware payment terminals and point-of-sale systems.


Stripe is one of the most adaptable payment processors available. It's made for web developers who want to customize the product's APIs to meet their demands. Stripe allows you to accept payments in over 130 different currencies using credit cards, debit cards, and even some cryptocurrency. It levies a fee of 2.9% plus 30 cents for each successful card transaction. Stripe is also integrated right into your Shopify store.


PayPal is a popular choice for small-business owners seeking a low-volume payment processor—one that doesn't handle a large number of transactions regularly. It has inexpensive setup expenses (no monthly fee, no minimum amount), and it's used in over 200 countries and 26 currencies around the world. PayPal provides direct integrations with your ecommerce site. For online transactions in the United States, PayPal charges 2.9% plus 30 cents for each transaction, and 4.4% plus 30 cents for purchases outside the United States. For in-store transactions in the United States, it charges 2.7% plus 30 percent, and 4.2% plus 30¢ worldwide.

Payline Data

Merchants can collect payments online, in-store, and through a mobile app using Payline Data. Cash advances, customer data, and a convenient QuickBooks link are all available to merchants through the organization. The company's customer service is also well-liked. The company charges interchange + 0.2% and $10 for each card swipe transaction, and 0.3% and $20 per keyed-in transaction, and its contracts are month-to-month.

What to consider when choosing a payment processor

When deciding between payment processors, the most important factors to examine are the price structure and whether you'll need to process payments in foreign currencies. Consider the following while evaluating payment processors:

  • Is there a one-time or introductory fee? After that, an annual fee?
  • Are there transaction costs with a monthly membership as well?
  • Will you require credit card processing equipment, such as in-store terminals, to be purchased or leased?
  • Is there a charge to link to your merchant account via a gateway?
  • Will you be liable for fees if a chargeback occurs?
  • Will there be a charge for verifying customer addresses or billing ZIP codes?
  • If you decide to discontinue using the processor, will you have to pay a termination fee?
  • Will you have to accept payments from outside the country?

Final thoughts

If your firm accepts card payments in this day and age, you'll need a payment processor. However, there is no such thing as a one-size-fits-all service. As shown above, there are a range of models and items to pick from, each geared to the demands of a different type of business: from small mom-and-pop corner stores to large internet retailers.

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