Best merchant services: 7 providers compared

The best merchant services give you the whole setup from one provider: a merchant account, terminals and online tools, a person to call, and deposits on a schedule you can plan around, all on pricing you can check. This list of merchant services providers is published by Clearo Payments, and we've ranked ourselves first on the criteria below. The six companies after us are processors and banks with different strengths. Everything we say about them comes from their own websites, linked so you can verify it, because we haven't tested their services ourselves.

How we chose the best merchant services

Merchant services is a bundle, so we judged the whole bundle against five criteria:

1. Pricing you can check: interchange-plus, where interchange passes through and the markup is its own line.
2. A way out: no long-term contract on the merchant account and no fee to cancel it.
3. One person who knows your account: a dedicated rep assigned to every client.
4. Proof before you switch: a free statement review showing today's cost next to ours.
5. The full package: a merchant account, terminals, online and phone payments, and fast funding from one provider.

Behind Clearo, the order reflects how many of these five criteria each company's own pages describe. Helcim's describe interchange-plus pricing with no long-term contracts, Stax and Square describe some of the same terms, and Chase, Global Payments and TD Bank complete the list on the full package.

Some businesses will rank these differently. If you'd rather keep card payments with the bank that holds your business account, start with the Chase and TD Bank entries. If you want restaurant or retail POS software bundled with processing, Global Payments and Square both sell POS software with their payments.

The last column shows where each company's own pages confirm it offers the products described here.

1. Clearo Payments

Why Clearo ranks first

Merchant services is a package, and Clearo Payments delivers the whole package on terms that meet our first four criteria. You get a merchant account, terminals, online and phone payments, back-office tools and same-day or next-day funding options from one provider, priced on interchange-plus with no long-term contract or cancellation fee. Every client has a dedicated rep, and the free statement review lets you see the numbers before you sign anything.

How the pricing works

We set up merchant accounts on interchange-plus pricing. Interchange, the fee the card networks set for each type of card, passes through at cost, and our margin is a separate line on the statement. Because Visa publishes its US interchange schedule, you can check the interchange lines on a Clearo statement yourself, which leaves our margin as the number to compare between providers. When we review your statement, fixed fees go into the effective rate too, so the comparison covers your whole bill.

Based on its client records, Clearo says businesses moving from flat-rate pricing have saved 20 to 50% on processing costs. Card mix, average ticket and volume decide what any one business saves.

What you get

• Equipment: POS terminals in countertop, wireless and portable models for chip, tap and swipe, which accept Visa, Mastercard, Apple Pay, Google Pay and Interac, plus mobile payments with tap to pay and card readers.
• Online and remote: hosted checkout and gateway integration with AVS, CVV and velocity screening, and a virtual terminal for phone and email payments, invoices, payment links and recurring billing.
• Risk and compliance: PCI compliance support, chargeback management tools and a credit card surcharging program covering compliance, disclosure and setup.
• Funding and reach: same-day or next-day funding options, for businesses in the US and Canada.

Switching

The free statement review puts your current costs next to ours before you decide. If you move, there's no long-term contract and no cancellation fee, and your dedicated rep is the person you call. Clearo says setup takes under 48 hours.

If you want restaurant POS software bundled with processing, Global Payments' Genius or Square's restaurant POS may suit you better, since we supply terminals and processing rather than POS software.

2. Helcim

Helcim, a payment processor serving Canada and the US, suits owners who want full merchant services on interchange-plus pricing without a long-term contract. Its pricing page lists no long-term contracts, no cancellation fees and no setup fees, and its Contract Buyout Program gives switching merchants a credit toward early termination or equipment lease fees from their previous processor, applied to future Helcim processing fees.

Best for: businesses that want interchange-plus merchant services month to month, including help leaving an old contract.

3. Stax

Stax, a payment processor built around a monthly membership, suits businesses that would rather pay a membership than a percentage markup. Its pricing page says there's no percentage markup on interchange and lists recurring billing, fraud protection and compatible terminals for in-person payments, with no cancellation fees tied to long-term contracts. Its homepage says its support team is US-based.

Best for: businesses that want a membership model with no percentage markup on interchange.

4. Square

Square sells card processing alongside free POS software, card hardware and invoicing, a fit for small businesses that want merchant services and POS software from one company. Square says it offers free POS software with no monthly fees and has a restaurant POS with its own pricing page, and its Virtual Terminal page describes no long-term contracts.

Best for: businesses that want free POS software, hardware and invoicing bundled with card processing.

5. Chase

Chase pairs merchant services with business banking, so it suits businesses that want card payments and their bank account with the same company. It describes QuickAccept as integrated point-of-sale tools for emerging and small businesses, and its Tap to Pay page ties phone payments to a Chase Business Complete Banking account with QuickAccept turned on.

Best for: Chase Business Complete Banking customers who want card acceptance tied to their bank account.

6. Global Payments

Restaurants and retailers that want POS software and processing from one provider can look at Global Payments, whose Genius platform pairs the two. Its Genius page lists plans named Essentials, Advanced and Complete, and its Genius for Restaurants page lists US-based customer support around the clock.

Best for: restaurants and retailers that want the Genius POS and processing from a single provider.

7. TD Bank

TD Bank sells merchant services to US small businesses, a natural option for owners who already bank with TD and want terminals and phone payments in the same place. Its Merchant Solutions page offers terminals and devices for small businesses, and TD Bank offers Tap to Pay on iPhone for small business payments. In Canada, TD Merchant Solutions offers the Clover platform.

Best for: TD Bank small business customers who want terminals, Tap to Pay on iPhone and flat-rate pricing.

What do merchant services include?

A full merchant services setup has six parts, and any quote should cover each one:

Underwriting is what separates a merchant account from an app download. Bank examiners are told to expect it: the OCC's handbook says an acquiring bank relies on each merchant's creditworthiness, and it names chargeback credit risk as a significant risk to the bank's earnings and capital (OCC). That's why approval can come with conditions, such as a reserve. Our guides to what a merchant account is and how to get a merchant account walk through the application, and our guide to rolling reserves covers held funds.

How do you compare merchant services providers?

Line the offers up against the same questions, in writing. Four areas matter most.

Who you're signing with

The salesperson may not work for the bank behind your account. Visa describes independent sales organizations as agents of the acquirer that don't process transactions or receive settlement funds, so signing through one still puts you under contract with an acquiring bank (Visa). Ask who the acquirer is and whose name is on the agreement. Our guide to independent sales organizations explains the setup.

The contract and the way out

Get the term, the auto-renewal clause and any exit fee in writing. Equipment is the usual trap, and the FTC has warned about leases where businesses paid thousands for card equipment worth a few hundred dollars. In New York, the state Attorney General took an equipment leasing company to court over card terminal leases. On June 8, 2020, the court ruled for the Attorney General and ordered relief that included rescinding the company's equipment leases (New York Attorney General).

Funding and reserves

Ask when approved sales land in your bank account, and whether any money will be held back. Reserves are common enough that the OCC's handbook describes many banks using holdback or reserve accounts for higher-risk merchants (OCC). If cash flow is tight, ask about same-day or next-day funding; our guide to same-day funding explains how deposit timing works.

Support

Ask who answers when a terminal stops working on a Saturday, and whether you'll reach the same person next time. A rep who already knows your account saves the first ten minutes of every call.

What do merchant services cost?

Merchant services cost the same three layers as any card processing: interchange, network fees and the provider's markup. On Visa's small business page, what merchants pay is a "merchant discount" to their own financial institution, usually figured as a percentage of each transaction (Visa). Mastercard's interchange explainer, for its part, calls interchange "one component of the Merchant Discount Rate (MDR) established by acquirers" (Mastercard).

Full-service accounts often carry fixed fees too, such as statement, PCI, gateway and terminal rental fees, and sometimes a monthly minimum. Count them all. Say an auto repair shop in Philadelphia runs $55,000 in card sales in a month, and its statement shows $1,265 in processing charges plus $85 in fixed fees for the statement, PCI and gateway. Its effective rate is $1,350 divided by $55,000, or about 2.45%. That number, not the headline rate, is the one to compare. The figures are made up for the example.

Large tickets change the math. A shop billing hundreds of dollars per job pays any percentage markup on every one of those dollars, so the percentage matters more than a per-sale fee. Our page for automotive businesses covers that case, and our guide to reading a merchant statement shows where each fee appears.

The next step

For a free statement review of your current merchant services, send us a recent statement. We'll list every fee, work out your effective rate and show what the same month would cost with us, fixed fees included. If the numbers say you should stay where you are, we'll tell you. We set up merchant services for businesses throughout the United States and Canada.