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The 3 best ways to accept credit cards as a small business

This step-by-step guide breaks down the process and highlights the best payment processors to use.
Written by Erin Gobler, Contributor
Reviewed by Toni Husbands
PayPal | A name that everyone recognizes
A name that everyone recognizes
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Square from Block | A favorite for in-person and online businesses alike
Square from Block
A favorite for in-person and online businesses alike
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Stripe | Well-known for its online payment processing
Well-known for its online payment processing
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One of the things you'll have to plan for when starting your own business is how your customers will pay you. Sure, cash might be the simplest payment method, but it's not the most popular. In fact, a 2019 Federal Reserve study found that only a small percentage of payments today are made with cash and about 34% are made with credit cards.

It's definitely in your best interest to accept credit cards for your small business. To help you get started, we've broken the process down into three simple steps -- and we've listed the three best payment processors to use.

How to easily accept credit card payments as a small business

Step 1: Decide how you'll accept payments

First, decide how you will accept credit card payments. The primary options are:

  • In-person payments
  • Online payments
  • Mobile payments

Depending on the type of business you run, it might be quite clear what type of payments you'll accept. For example, if you provide online services, chances are you'll solely accept online payments.

For other types of businesses, you might need a combination of payment methods. For example, maybe you run an online e-commerce site where you sell crafts, but you also sell them in-person at craft fairs. In that case, you would likely need both online and mobile payments. On the other hand, a new restaurant might need to accept primarily in-person payments but also allow for online payments for to-go orders.

You know your business best, and only you can decide how you'll need to accept payments.

Step 2: Choose your payment processor

In the past, you needed a merchant account to accept credit card payments for your small business. Your merchant account would provide payment processing, point of sale systems, and credit card terminals.

While merchant accounts are still an option, they often require high fees and lengthy contracts. And thanks to technology, there are plenty of more affordable options available today.

A payment processor or payment service provider provides a similar service as a merchant service without opening your own account. They allow for credit card processing and can provide any hardware you need without the costs and complications of a merchant account.

Once you know how you'll accept payments, it's time to choose a payment processor. There are plenty of payment service providers to choose from, and it can be difficult to decide which one is best.

Step 3: Get the right hardware and software

Depending on the type of business you run, you might need to have hardware or software in place. If you run an entirely online business, you'll need to set up your payment gateway on your business's website.

For businesses accepting in-person and mobile payments, you'll need actual hardware. Some payment processors will even provide you with the point of sale equipment you'll need to accept payments in person.

What are the best payment service providers?

There are many payment service providers choose from, but these three are the most popular with small businesses.

PayPal is one of the top online payment processors, making it easy for small businesses to accept both in-person and online credit card payments.

First, PayPal accepts credit card readers that you can keep at your place of business or take with you on the go. Another option for in-person payments is a QR code, which your customer scans. This contactless payment method allows the customer to pay from their phone. Finally, PayPal provides payment processing for entirely online transactions.

PayPal updated its fees on March 31, 2022. All of the information about the new fees can be found here.



Square, from Block, has become a favorite for in-person and online businesses alike. When you sign up for Square, you can easily set up online payments on your website. Square also provides the hardware you need to accept payments at your place of business or on the go. Additionally, Square makes it easy to send invoices, which send the payer directly to a payment page.

Square's fees are as follows:

  • Card-present in-person payments: 2.6% + $0.10 per transaction
  • Card-not-present in-person payments: 3.5% + $0.15 per transaction
  • Online payments: 2.9% + $0.30 per transaction

Square from Block

Stripe is well-known for its online payment processing, and you can easily create a checkout process on your website and collect payment information. You can also accept multiple currencies, with more than 135 available.

For small businesses that send monthly invoices, you can also set up recurring subscriptions and billing for credit card payments. 

Finally, Stripe provides Stripe Terminal, a point-of-sale device you can use to collect credit card payments, Google Pay, Apple Pay, and more.

Stripe's fees are customizable based on your business, but the standard fee for a successful card charge is 2.9% + $0.30 per transaction



Is it necessary to accept credit cards for my small business?

It's not required that your small business accept credit cards, but you may miss out on business if you choose not to. Many consumers today choose to use credit cards to pay for goods and services.

How do I start accepting credit cards for my small business?

To accept credit cards for your small business, start by deciding what type of payments you'll need to accept: in-person, mobile, and/or online. Once you know that, you can research the best payment processors for your needs.

What is the best payment service provider for small businesses?

No one payment processor outshines the rest, but three of the most popular are PayPal, Square, and Stripe. You'll have to evaluate each one to determine which one best meets your needs.

What is the cheapest way for small businesses to accept credit card payments?

The cheapest way to accept credit card payments depends partially on whether you'll be accepting payments in-person or online. Payment service providers generally have different fees for different types of payments.

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