Small merchants often don’t enjoy the same savings and options as larger businesses when it comes to credit card processing and other fees. But those small businesses received some potentially good news this week when mobile credit card processing company Square announced that users will now have the option to pay a flat monthly fee instead of paying a small fee for every transaction.
Specifically, businesses can choose between paying $275 per month to use the service, or 2.75% per swipe. The monthly fee may not be the best option for small businesses that don’t process very many payments, but it would lead to savings for businesses that process over $10,000 in credit card payments per month. Square will only allow businesses that process up to $250,000 per year to pay the flat monthly fee.
The Square team stated in a blog post that the fixed pricing option for merchants aims to “level the playing field” for small businesses and help relieve uncertainty about fees by ensuring that the amount processed from a customer is the same amount that is deposited in the business’s account.
Square works with Visa, MasterCard, American Express, and Discover, and the credit card reader is free for all users. Square Register also gives small businesses the ability to track inventory, share information, and accept payments.
Of course, this pricing structure isn’t the first big move for Square in the past few weeks. The new pricing model, along with Square’s recent deal with Starbucks, is all part of a larger trend where more and more businesses and consumers are moving away from cash payments. There are many mobile payment competitors that have surfaced recently, but this new option from Square is something that hasn’t been offered by other businesses, and it may entice even more merchants to jump on the mobile payments bandwagon.
Just a small correction: according to the SquareUp website (https://squareup.com/pricing), it’s still 2.75% per swipe, not $2.75 per swipe.
Hi Kyle, Good catch! We fixed it, and changed it to match the website, at 2.75% per swipe.
– Anita Campbell,
Editor in Chief
Thanks for fixing it!
I’ve loved Square’s easy to use process, but was worried that the per transaction fee would kill my one woman business so I’m glad to see that they giving me more options. I will rethink my plans now.
Square knows it’s customers well enough to know they’ll still make money with these rates. Great move by a very nimble company.
I appreciate that Square is making changes to adapt to customer needs. What I’d like to see is the option to set up recurring monthly payments. With that I would use Square more often.
I’m a silversmith and do a lot of craft shows. Having the Square in my pocket allows me to except credit cards anywhere.