Top 10 Best Credit Card Payment Processing for Small Business in UK

Last Updated on August 24, 2024

In today’s fast-paced business environment, having a reliable credit card payment processor is crucial for the success of any small business in the UK. Whether you’re running a retail store, an online shop, or a service-based business, the ability to accept credit card payments can significantly impact your sales, customer satisfaction, and overall business efficiency.

With so many options available, choosing the right payment processor can be challenging. In this guide, I’ll walk you through the top 10 best credit card payment processors for small businesses in the UK, helping you find the best fit for your business needs.

What Is Credit Card Payment Processing and Why Is It Crucial for Small Businesses?

Credit card payment processing is the system that allows businesses to accept payments via credit and debit cards. When a customer swipes, inserts, or taps their card at your point of sale (POS), the payment processor securely transmits the transaction data between the card issuer, the payment gateway, and your merchant account. This process ensures that funds are transferred from the customer’s account to your business account.

For small businesses, having an efficient small business payment processing system is essential. It not only enables you to accept a variety of payment methods but also helps you streamline operations, improve cash flow, and enhance the overall customer experience. A good payment processor can reduce the risk of fraud, offer competitive processing fees, and provide the tools you need to manage your transactions effectively.

How Do Credit Card Payment Processors Work?

There are lots of best credit cards available for business owners. But understanding how credit card payment processors work can help you choose the right one for your business. The process generally involves three key components:

1. Merchant Account: This is a type of business bank account that allows you to accept and process payments. It temporarily holds the funds before they are transferred to your business account.
2. Payment Gateway: This is the technology that securely transfers payment information from your POS system or e-commerce site to the payment processor.
3. Credit Card Reader: This is the hardware that reads the card information, whether it’s a physical terminal in-store or a virtual terminal for online transactions.

Each transaction typically involves a small fee, which can vary depending on the payment processor and the type of transaction. When choosing a processor, consider the credit card processing fees in the UK and how they will impact your profit margins.

Top 10 Best Credit Card Payment Processors for Small Businesses in the UK

Let’s dive into the top 10 credit card payment processors that can help your small business thrive in the UK.

1. Square

Square is a popular choice for small businesses due to its simplicity and flexibility. It offers flat-rate fees with no hidden charges, making it easy to understand what you’ll pay. Square’s mobile payment processing capabilities allow you to accept payments anywhere, whether in-store, online, or on the go.

• Features: No contracts, mobile-friendly, comprehensive POS system.
• Processing Fees: 1.75% per chip and PIN or contactless transaction; 2.5% for keyed-in transactions.
• Best For: Businesses looking for a simple, no-nonsense payment processor.

2. PayPal Here

PayPal Here is another versatile option, especially for businesses that need to integrate online and offline payments. With competitive fees and the backing of PayPal’s robust e-commerce platform, it’s a solid choice for small businesses.

• Features: Integrated online and offline payments, easy setup, reliable brand.
• Processing Fees: 2.75% per transaction.
• Best For: Small businesses that sell both online and in physical locations.

3. SumUp

SumUp is known for its affordability and ease of use, particularly for small businesses and sole traders. Its pay-as-you-go model is ideal for businesses with lower transaction volumes, and it offers compact, affordable card readers.

• Features: No monthly fees, low-cost card readers, simple mobile app.
• Processing Fees: 1.69% per transaction.
• Best For: Sole traders and small businesses looking for cost-effective solutions.

4. iZettle by Zettle

iZettle, now known as Zettle by PayPal, offers a user-friendly interface with robust analytics and reporting tools. It’s a great option for businesses that need a reliable and scalable payment solution with contactless payment capabilities.

• Features: Advanced analytics, contactless payments, easy-to-use interface.
• Processing Fees: 1.75% per transaction.
• Best For: Growing businesses that require detailed sales insights.

5. Worldpay

Worldpay is one of the largest and most established payment processors in the UK, offering a wide range of services tailored to small businesses. With high-level security features and various contract options, Worldpay provides a reliable and secure solution.

• Features: Comprehensive security, flexible contracts, 24/7 customer support.
• Processing Fees: Typically between 1.6% and 2.75% per transaction, depending on volume and contract terms.
• Best For: Small businesses looking for a trusted and established payment processor.

6. Stripe

Stripe is renowned for its powerful online payment processing capabilities. It’s highly customizable, making it a preferred choice for tech-savvy businesses that need a scalable and integrated payment system for e-commerce.

• Features: Customizable API, strong online payment processing, global reach.
• Processing Fees: 1.4% + 20p per transaction for European cards; 2.9% + 20p for non-European cards.
• Best For: E-commerce businesses and companies with complex payment needs.

7. Shopify Payments

If you’re already using Shopify for your online store, Shopify Payments is the natural choice for payment processing. It’s fully integrated with Shopify’s platform, eliminating the need for a separate payment gateway and simplifying the payment process.

• Features: Integrated with Shopify, no transaction fees for Shopify users, seamless setup.
• Processing Fees: 1.5% + 25p per transaction for basic plans; lower rates for higher-tier plans.
• Best For: Online retailers using Shopify as their e-commerce platform.

8. Elavon

Elavon offers a wide range of payment solutions for businesses of all sizes. With excellent customer service and a strong reputation in the industry, Elavon is a reliable choice for small businesses looking for comprehensive payment processing services.

• Features: Wide range of payment options, strong customer support, secure transactions.
• Processing Fees: Typically around 1.75% per transaction; varies based on business type and volume.
• Best For: Small businesses seeking comprehensive and reliable payment processing.

9. Sage Pay (now Opayo)

Sage Pay, now rebranded as Opayo, is known for its secure payment gateway and robust fraud prevention tools. It’s a great option for small businesses that prioritize security and want to protect their transactions from potential fraud.

• Features: High-level security, easy integration, trusted brand.
• Processing Fees: Starting at 1.99% per transaction.
• Best For: Businesses that prioritize security and fraud prevention.

10. Barclaycard

Barclaycard offers tailored payment solutions for small businesses, including competitive transaction fees and a variety of payment options. It’s a well-established brand in the UK, making it a reliable choice for businesses of all sizes.

• Features: Competitive fees, wide range of payment options, tailored solutions.
• Processing Fees: Typically around 1.6% to 2.5% per transaction, depending on the business profile.
• Best For: Small businesses seeking a reputable and versatile payment processor.

How to Choose the Right Payment Processor for Your Small Business?

Choosing the right payment processor depends on your business’s specific needs. Here’s a step-by-step guide to help you make the right choice:

1. Assess Your Business Needs: Determine your transaction volume, preferred payment methods, and required features.
2. Compare Fees and Features: Look for transparent pricing, low transaction fees, and features that align with your business model.
3. Consider Customer Support: Choose a provider with strong customer support to help you resolve any issues quickly.
4. Check Compatibility: Ensure the payment processor integrates seamlessly with your existing systems, whether online or in-store.

By following these steps, you can select a payment processor that will best support your small business’s growth and success.

Related Article: Credit Cards With Zero Percent Interest.

Common Pitfalls to Avoid

When choosing a payment processor, be aware of these common pitfalls:

• Hidden Fees: Some processors advertise low rates but have hidden fees for specific transactions or services.
• Long-Term Contracts: Be cautious of long-term contracts that lock you in with high termination fees.
• Poor Customer Service: Ensure the provider offers reliable and responsive customer support to avoid disruptions in your payment processing.

Avoiding these pitfalls will help you select a processor that truly meets your needs without unexpected surprises.

Related Article: Top 15 Business Credit Cards For Poor Credit History In UK

Conclusion

Choosing the right credit card readers is crucial for the success of your small business in the UK. The right processor can streamline your operations, improve customer satisfaction, and ultimately boost your bottom line. By carefully considering the options listed above, you can find the best payment processor that aligns with your business goals and budget. Whether you need a simple, no-contract solution like Square or a comprehensive, secure option like Worldpay, there’s a payment processor on this list that’s perfect for your small business.