What Is Square Merchant Services?
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 payment processing 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 use Square Ipad payment terminals, it’s not the best solution for a restaurant quite frankly. Instead, a restaurant or any business with $5000 per month in sales would pay less and make a bigger profit by using a less expensive regular merchant account.
Square Processing Fees
Square swiped fees and tap fees are 2.6% with a $0.10 per transaction fee. Keyed in sales are 3.5% and $0.15. E-commerce sales are 2.9% with a $0.30 authorization fee.
In comparison our merchant account fees are as low as 1.69% and $0.25 per transaction. And if you generate $20,000 and more in monthly sales, you might be able to get an even lower rate. Contact me to find out more.
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.
What Cards Does Square Accept?
They accept Visa, MasterCard, Discover, American Express. If you own a website it’s possible to accept additional cards with the right app. For example, you could add on the ability to accept Paypal or Bitcoin.
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