What does it really cost to take card payments on your phone?
The percentage in the advert is rarely the price you pay at the end of the month. This page takes the cost structure apart piece by piece and works through three realistic scenarios for a UK business.
Rates documented for the UK market run from 0.50% to about 1.75% per transaction, most with no monthly fee. Four things decide what you actually pay: the surcharge on commercial and non-UK/EEA cards, any fixed pence fee per payment, the contract term, and how and when you are paid out. Fifteen of the 33 providers in this market publish no price at all.
The five cost blocks
1. The headline rate — and when it does not apply
Almost every provider advertises a "from" rate. It normally applies only to contactless consumer debit cards issued in the UK or the EEA. The moment a commercial card, a premium rewards card or a card issued outside the UK and EEA is presented, a higher rate applies. This matters more since Brexit: the UK kept domestic interchange caps, but the caps on UK–EEA cross-border transactions no longer apply, and acquirers have priced that in. We publish provider pricing rather than scheme fees, so check your provider's own rate card for the non-UK/EEA and commercial card bands before you sign.
2. The fixed pence fee per transaction
A rate quoted as "1.49% + 5p" sounds harmless. On an average sale of £4 those 5p are another 1.25%, so the real cost is 2.74%. For a coffee shop, a bakery or a market stall this line matters far more than the percentage does. Work out your own average sale first, then compare — a low percentage with a fixed fee can easily cost more than a higher percentage without one.
3. Monthly fee, hardware rental and the bundle trap
Software on a phone you already own has no hardware cost. A rented card machine typically does, and some providers only offer their app rate inside a bundle that includes the rental. Check whether a standalone software tariff exists at all. Where a monthly fee buys a genuinely lower rate it can be worth it — but only above a certain turnover, and you can work out exactly where that point is in the table below.
4. Contract term and how you get out
This is the most commonly overlooked point and the most expensive to get wrong. Providers such as SumUp, Zettle by PayPal and myPOS work with no minimum term, while others tie you in for a fixed period with an early termination charge. A rate that is 0.3 percentage points lower is worth very little if you cannot leave for four years. Always read the term, the notice period and the exit fee together.
5. Payouts, and what happens to the fee on a refund
Next working day is the UK norm. Providers that issue you an account of their own can settle instantly, but then the money sits with them rather than in your bank. Some charge for the transfer out, and most do not refund the original transaction fee when you refund a customer — that is usually in the fee schedule rather than the advert.
Three worked examples
None of these three models charges a fixed pence fee, so your average sale does not change the result. Consumer debit cards only, no promotional rates, no VAT effects. The rates are real figures from our database (SumUp, Dojo, Zettle by PayPal); the scenarios are illustrative.
| Monthly card takings | at 0.79%, no monthly fee | at 1.20% + £11.99/month | at 1.75%, no monthly fee |
|---|---|---|---|
| £1,000 | £7.90 | £23.99 | £17.50 |
| £5,000 | £39.50 | £71.99 | £87.50 |
| £20,000 | £158.00 | £251.99 | £350.00 |
The lowest published transaction fees
| Comparison | Transaction fee | Monthly fee | Comparison |
|---|---|---|---|
| Teya (ehem. SaltPay) | from 0.50% | n/a | Europe |
| SumUp | from 0.79% | none | Europe |
| Revolut Business | from 0.80% | 10 GBP/mo. | Europe |
| Tide | from 0.89% | none | Europe |
| myPOS | from 1.10% | none | Europe |
| Viva.com (ehem. Viva Wallet) | from 1.16% | none | Europe |
| Dojo (Paymentsense) | from 1.20% | 11.99 GBP/mo. | Europe |
| Worldline | from 1.30% | n/a | Europe |
| Monzo Business | from 1.40% | n/a | Europe |
| Flatpay | from 1.49% | none | Europe |
| Stripe | from 1.50% | none | Europe |
| bunq | from 1.50% | none | Europe |
Only providers that publish a figure appear here — the other fifteen in this market quote on request. Rates are headline rates for consumer debit cards and are not directly comparable across countries, because interchange rules and card mix differ. The source for each figure is on the provider profile; the full list is in the comparison table.
Questions about cost
Is any of this really free?
The app, the account and the onboarding are free with most providers. The money is made on the transaction fee, so there is no such thing as free card acceptance — only a choice between paying per payment and paying a fixed amount each month. Which is cheaper depends entirely on your turnover.
Card machine rental or software on my phone — which is cheaper?
For low and irregular volumes, software on a phone you already own is almost always cheaper, because there is no rental and often no monthly fee. Rented terminals earn their keep at higher volumes, where a lower rate and interchange++ pricing outweigh the rental. Compare both in the full table.
What does interchange++ mean?
A pricing model that itemises the three parts of every card payment separately: the interchange fee that goes to the card issuer, the scheme fee, and the acquirer's own margin. It is more transparent than a single blended rate but much harder to compare, because your final cost depends on the mix of cards you take.
Do I pay the fee again if I refund a customer?
With many providers the original transaction fee is not returned when you issue a refund, so a refunded sale still costs you the fee. A few do return it. This detail sits in the fee schedule rather than on the pricing page, so it is worth checking before you commit.
Does this cover Making Tax Digital and my bookkeeping?
No, and it is important not to confuse the two. These apps take the payment and give the customer a receipt; Making Tax Digital governs how you keep records and file with HMRC. Some apps export to accounting software, but that is a separate requirement you have to satisfy yourself.