Square.com Card Payment
Square.com card payment services is one of the more recent credit card payment services in the industry. Square fills a unique niche in the credit card industry by targeting very small businesses that find it hard to justify monthly merchant account fees. Square is a very good fit for home based businesses or shops that generate anything between $200 to $1500 per month in sales.
Now, although some small restaurants have Square Ipad payment terminals, it’s not the best solution for a restaurant and quite frankly, an expensive solution. Instead, a restaurant would pay less and make a bigger profit by using a less expensive regular merchant account. Square per transaction swiped fees are 2.75% with no per transaction fees or $275 per month for up to $21,000 in credit card volume. Any additional transactions are charged at 2.75%. Square typed in transactions are 3.50% plus $0.15.
In comparison our merchant account fees are as low as 1.69% and $0.25 per transaction. That comes to .0194 or $1.94 per $100. This means a savings of 1.0575 per $100, if you were to choose a regular merchant account instead of using Square Inc.
Here’s one more reason why Square Inc. isn’t always the best choice, daily discounting. Square makes deposits into a merchant’s bank account using a daily discount system. This means that fees are deducted prior to the deposit. For example, if a merchant key in a $100 sale, they will receive a deposit of $96.35. This is the gross sale amount minus Square’s 3.50% rate plus $0.15 fee per transaction.
Unlike Square, regular merchant account services offer a more accounting-friendly monthly discount method. With monthly discounting, the merchant services company makes gross deposits throughout the month and collects fees at the end of the month.
A monthly discount method provides increased cash flow than daily discounting. Plus, it also makes reporting and reconciliation easier for the accountant. Square doesn’t provide monthly discounting.
Are you ready for a better merchant account? Call (956) 887-0090