How to Choose a Merchant Service Provider
Which provider wins comes down to your monthly card volume and how you trade. If you take under about £100,000 a year, a pay-as-you-go provider like Square or SumUp is usually cheaper for you, and you skip contracts and monthly fees entirely.
Above roughly £200,000 a year, get a quote from an acquirer such as Worldpay or Takepayments, where the rate you negotiate can beat flat PSP pricing. Ask what your effective rate is once authorisation, settlement and PCI fees are added, not just the headline number you see advertised.
If you also sell in person, check the hardware and settlement terms before you commit. You want a reader that suits how you trade: SumUp or Square for the cheapest entry, myPOS if you need the money in your account the same day.
Best merchant service provider picks by business type
Best for small businesses: Square
Square’s 1.75% flat rate, £19 reader, and free POS app make it the most complete no-contract merchant service for businesses below £4,000/month in card volume.
The hospitality POS features (table management, modifiers, split bills) are free. No underwriting, no account manager required, no monthly fee.
Visit SquareBest for high volume: Tide Card Reader
Tide’s Sell In-Person plan at 0.89% + 3p (UK consumer debit) is among the lowest published in-person rates in the UK without a custom contract. At £5,000/month in card sales (200 sales of £25), the plan works out at roughly £68.50 including the £17.99 +VAT plan fee, versus £87.50 with Square at 1.75%. At that £25 average sale, Tide’s plan overtakes Square from about £2,400/month; the exact crossover depends on your average transaction value.
Visit TideCheapest hardware entry point: SumUp Solo Lite
SumUp Solo Lite at £25 is a simple, widely used mainstream card reader in the UK. The 1.69% PAYG rate is lower than Square’s 1.75%. The Payments Plus plan at £19/month drops the rate to 0.99%, break-even at £2,714/month. For a business that wants to start as cheaply as possible, SumUp is the answer.
Visit SumUpWhat will merchant services actually cost your business?
A headline rate on its own cannot tell you the cheapest provider, because fixed pence-per-transaction charges and monthly plan fees change the answer as your turnover and average sale change. The table below models the monthly processing cost for four typical businesses taking UK consumer debit cards in person. It excludes hardware and VAT on subscriptions, and uses each provider’s current published rates (checked 7 August 2026).
| Monthly card turnover / average sale | Square (1.75%) | SumUp (best of PAYG or Plus) | Tide (Sell In-Person) | myPOS (from 1.10% + 7p) |
|---|---|---|---|---|
| £1,000 / £20 (50 sales) | £17.50 | £16.90 (PAYG 1.69%) | £28.40 (plan not yet worth it) | £14.50 |
| £5,000 / £25 (200 sales) | £87.50 | £68.50 (Plus, £19/mo) | £68.50 | £69.00 |
| £10,000 / £40 (250 sales) | £175.00 | £118.00 (Plus) | £114.50 | £127.50* |
| £25,000 / £50 (500 sales) | £437.50 | £266.50 (Plus) | £255.50 | Custom* |
Monthly processing cost only (excludes hardware and VAT on subscriptions), UK consumer debit, card-present. SumUp uses whichever is cheaper of pay-as-you-go (1.69%) or Payments Plus (£19/month, 0.99%). Tide uses the Sell In-Person plan (£17.99 +VAT/month, 0.89% + 3p). *myPOS’s “from 1.10% + 7p” applies under £10,000/month; above that it moves to a custom rate. Premium, commercial and international cards cost more with every provider. Takepayments and Worldpay are quote-only — at £10,000/month and above it is worth getting a written quote from them (and from myPOS) to compare against these flat rates.
The pattern is consistent: below roughly £2,000/month a simple pay-as-you-go reader (SumUp or myPOS) is cheapest; from about £5,000/month a plan rate (Tide, or SumUp Payments Plus) overtakes flat-rate pricing; and at higher volumes it is worth putting the flat-rate winners up against a bespoke acquirer quote. Square stays the most expensive on rate at every level, which it offsets with its free point-of-sale software.
Best merchant service provider profiles
Square ReaderTop Pick
Tide Card ReaderLow-fee option
SumUp Solo LiteBest for Startups
myPOS Go 2Best for Mobile
TakepaymentsBespoke pricing
Stripe Terminal
WorldpayHigh-volume option
Other merchant service providers we considered
Our seven picks were chosen from a wider market. These providers were reviewed but did not make the principal shortlist for this general-purpose comparison — several are strong choices for a narrower need.
| Provider | Why we considered it | Why it is not in the main picks |
|---|---|---|
| Dojo | Popular hospitality card machine with fast next-day settlement | Rolling contract and higher entry cost than the no-contract picks |
| Zettle by PayPal | Well-known low-cost reader | 1.75% pay-as-you-go matches Square without Square’s free POS depth |
| Tyl by NatWest | High-street acquirer with UK support | Quote/contract model overlaps Takepayments and Worldpay without clearly beating them |
| Barclaycard Payments | One of the largest UK acquirers | Bespoke, quote-led pricing aimed at established merchants; harder to compare transparently |
| Revolut | Card reader bundled with a business account | Reader proposition is narrower than the specialists shortlisted here |
| Adyen | Enterprise omnichannel platform | Enterprise volume minimums make it a poor fit for this page’s SME focus |
Payment facilitator vs traditional merchant account provider
“Merchant service provider” covers three different models. Which one you need shapes the pricing, the contract and who actually underwrites you.
| Model | What it means | Examples here | Best suited to |
|---|---|---|---|
| Payment facilitator / PSP | Bundled acceptance under one account — no separate acquirer to arrange | Square, SumUp, myPOS, Tide | Smaller or simpler setups that want to start fast |
| Traditional acquirer / managed service | A dedicated acquiring relationship with bespoke, negotiated pricing and account management | Takepayments, Worldpay | Established or higher-volume businesses wanting a custom rate |
| Online platform / gateway-led | Developer-led online acceptance, with in-person Terminal as an add-on | Stripe | Ecommerce and multi-channel businesses |
If you are unsure which you need, start with our guide to what a merchant account is, and for online-first businesses compare payment gateways. Businesses that mainstream providers decline should read our high-risk merchant accounts guide.
Merchant service provider fees in depth
The cost of card acceptance has three layers: the card network interchange fee, the acquiring bank’s margin, and any software or hardware fees.
Payment service providers (PSPs) like Square, SumUp, Tide, and Stripe pool their merchant relationships and pass through a flat blended rate. Traditional acquirers like Worldpay and TakePayments quote interchange-plus or blended rates based on your card mix and volume.
For businesses processing under £100,000/year: a flat-rate PSP is usually cheaper and faster to set up.
For businesses above £200,000/year: a custom acquiring quote from Worldpay, TakePayments, or Dojo may produce lower effective rates, especially with a high proportion of low-cost debit transactions.
Stripe offers custom pricing for businesses processing above £100,000/year; below that threshold, the standard published rates apply.
Merchant service provider features compared
POS software
Square has the deepest free POS software: table management, modifiers, open tabs, appointments, and loyalty. SumUp POS Lite covers basic counter service.
Tide, myPOS, and Stripe Terminal handle transactions and reporting but are not EPOS platforms. Worldpay and TakePayments integrate with most third-party EPOS systems rather than providing one themselves.
Settlement and funding speed
myPOS settles to its wallet instantly. SumUp settles next day at 7am. Tide settles in three working days as standard (next working day for £2.99 +VAT/month).
Square settles in 1–2 working days. Stripe settles in 3 business days as standard; instant payouts are available for a 1% fee (minimum 40p), settling within around 30 minutes. TakePayments and Worldpay settle next working day as standard.
Payment facilitators like Stripe, Square, and SumUp use algorithmic monitoring to manage risk. Unusual chargeback patterns or flags against your industry profile can trigger automatic fund holds or account reviews.
Stripe also publishes a prohibited and restricted business list. Gambling and similar games of chance are barred outright, while regulated products such as CBD are allowed only within strict limits. Expect a facilitator to decline or later close an account in a listed sector.
We rate traditional acquirers like Worldpay or TakePayments higher for businesses where cash flow predictability is critical, though they require underwriting and contracts.
Final Verdict: Which Merchant Account Provider Should You Choose?
For most small UK businesses, SumUp Solo Lite and Square Reader are the easiest places to start: no monthly fee, no contract, same-day approval, and flat rates (1.69% and 1.75%) that are simple to budget. SumUp edges ahead on cost as volume grows; Square wins on its free POS app. Below roughly £6,000 a month in card takings, one of these two covers most needs.
The right answer changes with your priorities. myPOS Go 2 is the pick if same-day access to funds matters, settling instantly to a myPOS account. Tide Card Reader suits businesses already banking with Tide that want card takings in the same app. Stripe Terminal is the choice for tech-forward businesses already on Stripe online that want one unified payment stack. And once you are processing higher volumes and value cash-flow certainty over flexibility, the traditional acquirers — Takepayments and Worldpay — earn their contracts through negotiated rates and managed support, provided you accept the underwriting and longer terms.
The bottom line: Start with SumUp Solo Lite or Square Reader for low-cost, no-commitment card acceptance; choose myPOS Go 2 for instant funds, Tide for Tide bankers, Stripe Terminal for a Stripe-based stack, and Takepayments or Worldpay once volume and cash-flow predictability justify a contract.
Frequently asked questions
Which merchant service provider is cheapest?
There is no single cheapest provider. The winner changes with your monthly card turnover, your average sale (fixed pence-per-transaction fees bite harder on small sales), your monthly plan fee and your card mix. See the scenario-cost table above: below about £2,000/month a pay-as-you-go reader like SumUp or myPOS is usually cheapest; from around £5,000/month a plan rate (Tide, or SumUp Payments Plus) overtakes it.
Which provider is best for £5,000 a month in card payments?
At £5,000/month with a £25 average sale (about 200 transactions) in UK consumer debit, SumUp Payments Plus, Tide’s Sell In-Person plan and myPOS all land within about a pound of each other — roughly £68–£69/month in processing, versus £87.50 with Square. At that point choose on account fit and settlement rather than rate.
What is the best no-contract merchant service provider?
Square, SumUp and myPOS are all no-contract: you buy the reader outright and can stop any time. Tide’s Sell In-Person plan is a rolling monthly subscription with no lock-in. Takepayments (12-month card-machine term) and Worldpay (minimum term on some offers) are the contract options.
Do I actually need a merchant account?
Not separately, in most cases. Payment facilitators (Square, SumUp, myPOS, Tide) bundle the merchant account into the service, so you sign one agreement. A dedicated merchant account with a traditional acquirer (Takepayments, Worldpay) suits higher or more specialised volumes where bespoke pricing pays off.
When does a traditional merchant account become cheaper?
There is no universal turnover threshold. At higher volumes a negotiated acquirer rate can undercut flat pay-as-you-go pricing, but it depends on your card mix and the quote you are offered, and you have to weigh the contract and exit terms. The practical test: once you are past roughly £10,000/month, get written quotes from Takepayments and Worldpay and compare them against the flat-rate winners in the table above. See also our card-processing fees guide.
What is a merchant service provider?
A merchant service provider gives businesses the infrastructure to accept card payments. This includes a payment gateway (the connection between your checkout and card networks), a merchant account (the interim holding account for card funds), and usually hardware (a card reader or terminal). PSPs like Square and Stripe handle the acquiring relationship on your behalf.
Do I need a merchant account to accept card payments?
Not a dedicated one. Payment service providers like Square, SumUp, and Stripe maintain a pooled merchant account. You benefit from the same functionality without the underwriting process that individual merchant accounts require. A dedicated merchant account from an acquirer like Worldpay may offer lower rates at high volume but takes longer to set up.
What is the cheapest merchant service for a small business?
For low volume: SumUp Solo Lite at 1.69% PAYG with a £25 +VAT reader. For medium-to-high volume: Tide Card Reader on the Sell In-Person plan at 0.89% + 3p. Both are no-contract and available online, typically the same day.
Who is Stripe best suited for?
Stripe suits businesses with advanced API integration needs: subscription billing, multi-currency payments, marketplace payouts, and developer-built checkout flows. There is no monthly fee on the standard plan and no contract. Standard settlement is 3 business days; instant payouts are available for a 1% fee (minimum 40p). We recommend Stripe primarily for online-first and developer-led businesses. It does not assign dedicated account managers, so if you prefer a managed relationship consider TakePayments or Worldpay.
Can a payment facilitator freeze my funds?
Yes. Payment facilitators like Stripe, Square, and SumUp use automated risk monitoring. Unusual chargeback rates, high-risk industry flags, or sudden volume spikes can trigger automatic account reviews or fund holds. If cash flow certainty is critical, a traditional acquirer such as Worldpay or TakePayments is more predictable, though it requires a contract and underwriting.
Is my money safe with a payment provider?
Most card processors and e-money firms safeguard customer funds in ring-fenced accounts rather than as FSCS-protected bank deposits. From 7 May 2026, the FCA tightens this with new rules requiring payments and e-money firms to keep stricter records and reporting on the money they hold for you. It is not the same as FSCS cover, but it raises the bar on how your cash is ring-fenced. We would still sweep large balances to your own bank account.
How we reviewed Best Merchant Service Providers UK 2026
Ranking criteria. We ranked providers on cost, eligibility, features, and ease of access. Cost and protection carry the heaviest weight because these matter across every business type and rarely change with reader preferences.
Data sources. Every provider’s pricing page, terms, and product docs were checked directly, most recently on 7 August 2026. No comparison sites, no press releases, no affiliate material. FCA register cross-checked for regulatory status.
Update cadence. We re-verify every provider on this page at least monthly, and whenever a provider changes pricing, eligibility, or terms. The verification date on the page reflects the most recent full review. Some links on this page are affiliate links, see our editorial policy.