Updated April 24, 2020

How Much Does Square Charge

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Square's mobile card reader lets you accept credit card payments. But how much does Square cost? Read this review to see if it is good for your business.

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You may have heard that Square is free. But that depends on what you need out of it.

The platform does provide a free magstripe reader and POS app upon sign-up. You only pay flat-rate transaction fees for each card you process.

If your small business has more advanced needs, Square offers optional add-on services.

Read on to learn all about Square fees:

Square's Processing Fees

Square charges the following credit card processing fees for each transaction:

  • In-person: 2.6% + $0.10
    Includes swipe, chip, and contactless payments (such as Apple Pay and Google Pay), as well as prepaid gift cards

  • Online: 2.9% + $0.30
    Includes online eCommerce card transactions and invoices

  • Card-not-present: 3.5% + $0.15
    Includes manually entered keyed-in transactions via the virtual terminal and card on file transactions for recurring billing

It charges the same rates for all credit cards, including Visa, Mastercard, American Express, and Discover.

Square is a pay-as-you-go processor. There is no monthly fee for using the basic service. You don't pay anything if you don't have any credit card sales during the month.

Special Processing Rates

If you're using one of Square's specialized plans, you may get a discount on the processing rate when you use Square equipment.

  • Square for Restaurant
    Businesses using Square for Restaurant POS pay 2.6% + $0.10 per transaction for swipe, dip, and tap payments.

  • Square for Appointments
    Individuals using Square Appointments software pay 2.6% + $0.10 per transaction for swipe, dip, and tap payments.

    For 2 or more employees, the card processing rate drops to 2.5% + $0.10. Keyed-in transactions cost 3.5% plus $0.15.

  • Square for Retail
    With a Free Square for Retail plan, the rate for in-person payments is 2.6% + $0.10.

    With a paid Plus or Premium plan, the rate drops to 2.5% + $0.10. Online payments are 2.9% + $0.30.

Keep in mind that Square Terminal is not compatible with Square for Restaurants, Square for Retail, or Square Appointments POS apps.

Does Square negotiate rates?
Typically, Square won't negotiate rates. But they do offer custom pricing, which equates to negotiating. If you process more than $250,000 per year in card sales and your average ticket price is lower than $15, Square may provide lower rates.

Square Administration and Service Fees

Square offers a lot of features for free. There are no fees for:

  • Payment gateway
  • Virtual terminal
  • Online store powered by Weebly
  • Recurring billing feature
  • Magstripe card reader
  • Mobile POS
  • Chargebacks
  • Refunds

Not only does Square charge no chargeback fees (which often costs $20 per chargeback or even more with other providers), Square also offers a Chargeback Protection for up to $250 in eligible sales per month.

It also eliminates a lot of administration fees. You do not pay any:

  • Setup fees
  • Application fees
  • Account inactivity fees
  • Early termination fees
  • Dispute management fees
  • PCI compliances fees

The only fee you may encounter is the instant funding fee. The usual funding time for Square is 1 - 2 business days. If you want instant transfers to your bank account, there is a 1.5% fee of the amount you're transferring.

Square Equipment Charges

Square offers a variety of equipment to use in conjunction with its POS:

  • Square Magstripe Reader: First one is free, $10 for each additional

  • Square Reader for Contactless & Chip: $49 each

  • Square Stand for Contactless & Chip: $169 (iPad not included)

  • Square Terminal: $299 or $27/month

  • Square Register: $799 or $39/month

Square also offers complete POS kits that include everything you need. Read on to learn your options.

Is Square cheaper than a merchant account?
It's hard to beat a "free" POS like Square. But a merchant account will offer more robust features. You can also negotiate the merchant markup rate, which you can't do with Square.

However, many merchant account providers charge monthly fees for their service. If your business processes enough sales each month to justify any monthly fees, you may find lower card processing rates elsewhere.

Square Register Kit
Starting at $1,329, it includes:

  • USB receipt printer
  • Receipt paper
  • USB cash drawer
  • Square Register

Square Stand Kit for iPad
Starting at $676, it includes:

  • USB receipt printer
  • Receipt paper
  • Cash drawer
  • Square Stand for contactless & chip
  • Setup guide

You can purchase an iPad for $329 extra.

Rest Stand for iPad Mini Kit
Starting at $526, it includes:

  • Square Reader for contactless & chip
  • Receipt paper
  • Receipt printer
  • Universal stand
  • Cash drawer
  • Setup guide

Windfall Stand for Samsung Galaxy
Starting at $705, it includes:

  • Windfall Stand
  • Square reader for contactless & chip
  • Receipt printer
  • Receipt paper
  • Cash drawer
  • Setup guide

Square's Software Fees

All Square users get the Square point of sale app for free. You can use it on a mobile phone or tablet.

The Square app offers:

  • Sales reporting
  • Inventory management
  • Manage customer database
  • Store customer card information
  • Create and send invoices
  • Sell and accept gift cards
  • Manage employees
  • Square online store setup

If you have more needs, Square offers a few optional add-on programs and industry-specific POS for an additional charge.

Optional Add-On Programs

These more advanced tool are available for an extra fee.

Payroll
Square Payroll allows you to track your employee's hours import timecards. Features include multiple pay rates and customizable pay schedules. You can even offer benefits and 401k plans. Square takes care of tax filings.

Employee payrolls are $29/month + $5 per employee. Contractor payrolls are $5/person per month.

Loyalty program
Create loyalty programs and enroll and rewards customers directly from the POS. You can track total loyalty customers and compare how much they spend vs. non-loyalty customers. Starts from $45/month.

Advanced employee management
The standard Square POS comes with basic employee management. Team Plus allows for more functions, including unlimited permissions, tracking sales by team member, and managing multiple wage rates. Cost is $35/month per location.

Email marketing
Create email and social campaigns and track results, all within your POS. Starts at $15/month.

Special Industry-Specific Plans

Square also offers special point of sale plans for retail, restaurant, and appointment-based businesses.

Square for Retail
You can sell online, in-store, and manage your back-office all in one place. Here are some of the features:

  • Manage multiple locations
  • Advanced inventory tools, including unlimited SKUs
  • CRM
  • Purchase order management
  • Employee management
  • Get real-time reports
  • Manage customer support

  • Free ($0/mo): 2.6% + $0.10 in-person; 2.9% + $0.30 online
  • Plus ($60/mo per location): 2.5% + $0.10 in-person; 2.9% + $0.30 online
  • Premium ($299+/mo per location): custom processing rates available

Square for Restaurants
Get your front- and back-of-house on the same page with one system. It features:

  • Customize floor plans and menus
  • Add on customers items and modifiers
  • Send orders to the kitchen with just one tap
  • Online delivery integrations with apps like Postmates
  • Create discounts

  • Free: $0/mo
  • Plus: $60/mo per location
  • Premium: $299+/mo per location

All plans have the same processing rate of 2.6% + $0.10 for swipe, chip, and tap payments.

Square for Appointments
Square Appointments makes appointment setting simple and offers:

  • Free customer booking
  • Integrate with Instagram and Google
  • Automated reminders
  • No-show protection by requiring pre-payment or cancellation fees

  • Individual (free): 2.6% + $0.10 for swipe, dip, and tap
  • 2-5 employees ($50/mo): 2.5% + $0.10 for swipe, dip, and tap
  • 6-10 employees ($90/mo): 2.5% + $0.10 for swipe, dip, and tap

Businesses with over 10 employees can contact Square Sales team for pricing.

Square Funding Fees

Square's standard funding time is 1-2 business days. This has no cost.

If you want to receive funds immediately, there is an Instant Transfer option. This option has a 1.5% transfer fee of the amount you're transferring.

You'll need to link a bank account and supported Visa or Mastercard debit card. You'll also need at least $25 in your Square balance (after processing fees).

Is the Square Reader Worth It?

Financially, the Square mobile reader is a no-brainer because it's free. A big benefit is that it can process payments in "offline mode" even without an internet connection.

However, it can only accept payments by swiping. If you want to accept chip or contactless payments, you'll have to purchase the chip reader.

If you're a small business just starting out, Square can be a great affordable way to start accepting credit cards.

Square Fees vs PayPal

PayPal Here, PayPal's mobile credit card processor, charges 2.7% per card-present transaction and 3.5% plus $0.15 per keyed-in transaction.

On a $10 transaction, PayPal comes out cheaper by a few cents. It comes down to which system offers the POS features you need.

However, to access the PayPal virtual terminal, you'd have to get the PayPal Pro plan, which has a $30 monthly fee. To store card on file for recurring billing is another $10/month. Both of these features are free with Square.

PayPal Here also operates on a month-to-month contract with no setup fee.

Does Square report to the IRS?
The IRS requires Square to provide 1099-K forms if you meet certain criteria. If you have more than $20,000 in annual revenue AND you have more than 200 sales, then Square must send you a 1099-K.

Bottom Line

Square is one of the most popular credit card processors for small businesses. Typically, businesses with small average transactions (less than $20) fare best with Square. The free mobile point of sale app, user-friendliness, no hidden fees, and immediate approval upon signing up make it hard to beat.

We recommend comparing a few credit card processors to make sure you find the one best for you. Look closely at your annual sales, average transaction amount, and necessary features. If you have what it takes to get an individual merchant account and can negotiate lower rates, you may be better off.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

More from CreditDonkey:


Square Rates


Credit Card Processing Fees


What is Square



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