Square is a popular payment processing platform that provides businesses with the tools to accept payments both online and in-person. One of the key aspects that businesses need to consider when using Square is its fee structure for credit card processing. 

This article aims to break down the Square fee for credit card transactions, explain how they work, and provide insights into potential costs for different types of transactions.

Types of Square Credit Card Fees

Card-Present Transactions (2.6% + $0.10)

This fee applies when a customer physically swipes, dips, or taps their card using a Square reader or terminal. These transactions have lower fees due to the lower fraud risk associated with in-person payments.

Card-Not-Present Transactions (2.9% + $0.30)

If a customer enters their card details manually online or through a payment link, Square charges a higher rate because these transactions carry a higher fraud risk.

Manually Keyed-In Transactions (3.5% + $0.15)

When a merchant manually enters a card number, such as over the phone, the transaction is considered riskier, leading to a higher processing fee.

Square Credit Card Fee Calculator

Detailed Breakdown of Fees

Here’s a detailed look at Square's processing fees:

Factors Influencing Fees

The exact fees a business will incur depend on several factors:

Transaction Environment

Whether the payment is made in person or online significantly influences the fee structure. Card-present transactions typically have lower fees due to reduced fraud risks, whereas online or manually entered transactions are charged higher rates.

Business Type and Volume

Some businesses may qualify for lower rates based on their annual processing volume. High-volume businesses that process large transactions consistently may negotiate better rates or access discounts through Square’s specialized plans.

Subscription Plan

Square offers different plans that can affect processing rates. Businesses subscribing to Square’s premium plans may benefit from reduced fees. For instance, those using the Square for Retail plan might see slightly lower rates for in-person transactions depending on their subscription level.

Additional Costs and Considerations

Beyond transaction fees, businesses should also be aware of other potential costs associated with using Square:

• Monthly Subscription Fees: While the basic service is free, advanced features may require a monthly subscription fee.
• Instant Transfer Fees: If a business opts for instant transfers of funds, there is an additional fee of 1.75% per transfer.
• No Refund on Processing Fees for Returns: As of March 2023, Square no longer refunds processing fees when merchants issue full or partial refunds to customers.

Advantages of Using Square

1. Transparency: Square provides clear and straightforward pricing without hidden fees for activation, support, or PCI compliance.
2. No Long-Term Contracts: Businesses can use Square without being locked into long-term contracts or facing early termination fees.
3. Comprehensive Tools: Alongside payment processing, Square offers various business management tools, including inventory management and sales analytics.

FAQs

Q.1) Does Square charge the customer a fee?

No, Square does not charge customers a transaction fee. Instead, the fee is deducted from the total transaction amount before being deposited into the merchant’s account.

Q.2) What is Square’s credit card fee?

Square’s credit card fees vary depending on the payment method used, ranging from 1% for ACH transfers to 3.5% + $0.15 for manually keyed-in transactions.

Q.3) What is Square's instant transfer fee?

Square charges a 1.75% fee for instant transfers, allowing merchants to access funds immediately instead of waiting for the standard processing time.

By understanding Square's credit card fees, businesses can make informed decisions on payment processing, helping to optimize costs and improve profitability.

Final Thoughts

Square's credit card processing fees are competitive and designed to cater to a wide range of business types. With rates starting at 2.6% + $0.10 for in-person transactions and 2.9% + $0.30 for online payments, it provides a flexible solution for both small and large enterprises. 

Understanding these fees can help businesses make informed decisions about their payment processing needs and potentially save money when switching from other processors. For businesses considering using Square or those currently using it but unsure about their pricing structure, reviewing these details can clarify costs and help optimize payment strategies effectively.