The online payment solution you choose shapes how customers pay you, how quickly funds reach your account, and how much you pay per transaction. The market splits into two distinct categories: payment facilitators (Stripe, Square, PayPal) that handle everything under a single contract with published rates, and full payment gateway integrations that connect to a separate merchant account. For most UK businesses, the distinction matters more than the brand.
Best Online Payment Solutions at a Glance
- Best overall: Stripe — 1.5% + 20p for UK cards, full API, subscriptions, invoicing, no contract
- Best for small businesses: Square — free hosted checkout, 1.4% + 25p, unified online and in-person
- Best for recurring payments: GoCardless — direct debit specialist, 1% + 20p, lowest rates for subscriptions
- Best for existing PayPal users: PayPal Checkout — 1.99% + fixed fee, instant PayPal balance settlement
- Best for high-volume custom builds: Stripe or a dedicated gateway + acquirer — IC+ pricing once volume justifies it
Full Comparison Table: Best Online Payment Solutions
Rates verified April–May 2026. Confirm current rates directly with providers before committing.
| Provider | Standard online rate | Monthly fee | Contract | Settlement |
|---|---|---|---|---|
| Stripe | 1.5% + 20p (UK cards) | None | No contract | 3 business days (instant available at 1%) |
| Square | 1.4% + 25p (UK cards) | None | No contract | Next working day |
| GoCardless | 1% + 20p (Pay as you go) | None (PAYG) or from £29/month (Plus) | No contract | 2–3 business days |
| PayPal Checkout | 1.99% + fixed fee (UK cards) | None | No contract | Instant to PayPal; 1–3 days to bank |
| myPOS Online | 1.30% + 15p | None | No contract | Instant (to myPOS account) |
Best Online Payment Solutions
Best Overall: Stripe
Stripe is the most complete online payment solution for UK businesses. The standard rate is 1.5% + 20p for UK cards and 1.9% + 20p for premium UK cards (commercial and rewards cards). There is no monthly fee and no contract. The API covers one-off payments, subscription billing, invoicing, multi-currency settlement in over 135 currencies, marketplace payouts, and buy-now-pay-later via Klarna and other BNPL partners.
Standard settlement is three business days (with an initial seven-day hold for new accounts). Instant payouts are available within approximately 30 minutes for a 1% fee (minimum 40p). Stripe also supports in-person payments via Stripe Terminal, giving businesses a unified dashboard for online and in-person revenue. The self-serve model means no account manager — support is via documentation, ticket, and (on higher plans) phone.
Best for Small Businesses: Square
Square provides a free hosted checkout page, a free online store, and payment links — all without technical knowledge or a developer. The online rate is 1.4% + 25p for UK card transactions, with no monthly fee or contract. The Square free plan includes an online store, inventory management, and basic reporting. Invoices are free to send, with over 75% reportedly paid within a day (Square-reported figure).
Square’s advantage for small businesses is the unified account: in-person sales on a Square Terminal or Square Reader and online sales in the Square Online Store report in the same dashboard at consistent rates. Settlement is next working day, with instant transfers available for 1.5%.
Get SquareBest for Recurring Payments: GoCardless
GoCardless processes payments by direct debit, not by card — which makes it the right choice for subscription businesses, membership organisations, and any business billing customers on a recurring basis. The Pay As You Go rate is 1% + 20p per transaction, with a cap of £4 per transaction. The Plus plan (from £29/month) reduces the rate to 0.5% + 20p for businesses with consistent monthly volume.
Direct debit collection has a two to three business day clearing cycle — slower than card payments, but the failure rate is lower (customers cannot dispute a direct debit as easily as a card transaction). GoCardless integrates with Xero, Quickbooks, Sage, and over 350 other platforms. It is not suitable for one-off consumer payments where a customer does not want to set up a mandate.
Get GoCardlessBest for Existing PayPal Users: PayPal Checkout
PayPal Checkout allows customers to pay using their PayPal account, debit card, or credit card. The standard rate for UK card payments is 1.99% plus a fixed fee (which varies by currency — 30p for GBP). There is no monthly fee and no contract. Funds settle to the PayPal account immediately, with a one to three day transfer to a linked bank account.
The key advantage is buyer trust: PayPal is recognised by a large proportion of UK online shoppers, which can reduce checkout abandonment. The key limitation is the two-step settlement — funds go to PayPal first, then to your bank — and the rate is higher than Stripe or Square for standard card transactions. PayPal Checkout is best as an additional payment option alongside a primary gateway, not as your only online payment method.
Online Payment Solutions Compared
Stripe
Stripe provides a complete payment processing platform for UK businesses, from a simple payment link through to a fully custom checkout built on the Stripe API. Key rates: 1.5% + 20p for UK cards (standard online), 1.9% + 20p for premium UK cards (corporate, rewards), 0.75% + 20p for direct debit via Bacs, and 1.4% + 10p for in-person EEA cards via Stripe Terminal. No monthly fee, no contract.
Stripe Billing handles subscriptions with automatic retries, dunning management, and proration. Stripe Connect enables marketplace and platform payment flows. Stripe Tax handles VAT calculation and filing across multiple jurisdictions. The breadth of the platform means businesses rarely need a separate invoicing, billing, or tax tool alongside Stripe — all of these are built in.
The risk model is automated: unusual transaction patterns trigger holds without a direct relationship to call. New accounts face a seven-day settlement hold. For established businesses with predictable transaction patterns, this is rarely an issue. For businesses in sectors with variable patterns — events, seasonal retail, high-value single transactions — it is worth understanding the risk framework before relying on Stripe as the sole payment route.
Square
Square provides online payment acceptance via a free hosted store, embeddable checkout widget, payment links, and API integration. The online rate is 1.4% + 25p for UK cards and 2.5% + 25p for non-UK cards. Invoices are charged at 2.5%. The free plan covers the online store, basic inventory management, and customer records. The Plus plan (from £29/month) adds estimates, project billing, and custom invoice templates.
Square’s online store syncs inventory with in-person sales in real time, which reduces the manual reconciliation burden for businesses selling across both channels. The checkout can be embedded in an existing website or used as a standalone Square-hosted page without code. Settlement is next working day. Square integrates with Xero, Kashflow, WooCommerce, and Wix.
Square is best for businesses that want a working online payment setup without a developer, combined with an in-person payment option. The limitations are the relatively high invoice rate (2.5%) and limited developer tooling compared to Stripe. For API-first builds, Stripe is the stronger choice.
Get SquareGoCardless
GoCardless collects payments by UK Bacs direct debit, rather than by card. The Pay As You Go rate is 1% + 20p per collection (capped at £4). The Plus plan (from £29/month) offers 0.5% + 20p. The Pro plan (from £59/month) adds instant bank payments (Open Banking) and custom payment pages. There is no contract.
Direct debit is irreversible for the business once the mandate is set up — the customer cannot initiate a chargeback the way they can with a card payment. This makes GoCardless a lower-risk collection method for subscription businesses, gyms, accountancy firms, and similar recurring-revenue models. The two to three day clearing cycle is the trade-off.
GoCardless integrates directly with Xero, QuickBooks, Sage, FreeAgent, and Kashflow, as well as a wide range of subscription management platforms. We recommend it as the default choice for any UK business billing customers on a recurring basis, where the customer relationship is established enough to support a mandate setup.
Get GoCardlessPayPal Checkout
PayPal Checkout enables UK businesses to accept card payments and PayPal balance payments from a hosted checkout page or API integration. The standard UK card rate is 1.99% + 30p. There is no monthly fee and no contract. PayPal also offers Pay Later (Buy Now Pay Later) options including Pay in 3 and PayPal Credit, which can increase checkout conversion for higher-value purchases.
PayPal has a 435 million+ registered account base globally, which provides a meaningful conversion advantage on checkout pages where PayPal is offered as an option. The settlement path (PayPal account first, then bank transfer) adds one to three business days to reaching your bank. PayPal disputes, while manageable, can move faster than card chargebacks and favour buyers more readily.
We recommend PayPal Checkout as a supplementary payment method rather than a primary gateway. Adding PayPal as an option alongside Stripe or Square typically captures customers who prefer the PayPal buyer protection without requiring your whole payment operation to run through the PayPal ecosystem.
myPOS Online
myPOS Online provides UK businesses with an e-commerce payment page, virtual terminal, and payment links. The online transaction rate is 1.30% + 15p — lower than Stripe and Square for online payments. There is no monthly fee and no contract. Funds settle instantly to the myPOS e-money account, with a £1.50 fee per transfer to a UK bank account.
myPOS combines online and in-person payments in the same account, with the myPOS Go 2 physical reader (£29 + VAT) covering in-person transactions at 1.10% + 7p. The combination makes myPOS competitive on per-transaction cost for businesses needing both channels. The e-money account structure (not FSCS-protected) is the main constraint compared to Stripe or Square.
Get myPOSHow to Choose an Online Payment Solution
Four questions determine which solution fits your business.
One-off card payments or recurring billing?
For one-off card payments, Stripe or Square are the default choices. For recurring payments or subscription billing, GoCardless (direct debit) offers a lower rate and a more resilient collection model than card-based recurring billing. Many businesses use both: GoCardless for regular subscriptions and Stripe for on-demand card payments.
Do you need an online store or just a payment gateway?
Square includes a free online store. Stripe provides a hosted checkout and Stripe-hosted payment links, but does not include a full e-commerce store. If you need product pages, inventory management, and an online shop without a developer, Square is simpler. If you need a payment gateway to integrate into an existing website or custom checkout, Stripe’s API is the more capable choice.
How important is developer flexibility?
Stripe has the deepest developer documentation and most complete API. Square offers a capable API but with narrower scope. GoCardless has a straightforward API focused on recurring collections. PayPal and myPOS offer hosted solutions suitable for non-developers. If your payment flow requires custom logic, multi-step checkout, or integration with other systems, Stripe is the most capable platform.
What is your monthly card volume?
Below £10,000/month: published flat rates from Stripe, Square, or GoCardless are the right structure. Above £50,000/month: negotiate custom pricing from Stripe or consider an IC+ merchant account for in-person processing. At any volume: GoCardless is worth evaluating if more than 30% of your revenue is recurring.
Online Payment Fees and Costs to Watch
Card type surcharges
Standard UK debit cards attract lower interchange rates than premium credit cards (rewards, corporate, Amex). Stripe distinguishes between standard UK cards (1.5% + 20p) and premium UK cards (1.9% + 20p). If a significant portion of your customers pay with premium cards, the effective blended rate is higher than the published standard rate.
Non-UK card surcharges
Stripe charges 2.9% + 20p for non-EEA cards online. Square charges 2.5% + 25p for non-UK cards. If you sell internationally, calculate your non-UK card volume separately when comparing providers.
Refund handling
Stripe returns the fixed fee component on refunds but not the percentage fee. On a £100 refund, you would not recover the 1.5% processing fee already paid. Square and PayPal have similar policies. Factor refund rates into your effective cost of processing, particularly in e-commerce where return rates can be 10–30%.
Dispute and chargeback costs
Card chargebacks result in the transaction amount being reversed plus a chargeback fee. Stripe charges £15 per dispute; Square charges a similar amount. A high chargeback rate can also result in account review or termination by payment facilitators. If your business has above-average dispute rates, document each case to defend chargebacks and consider sector-specialist providers.
Currency conversion
If you price in GBP but accept cards in foreign currencies, the card network applies a currency conversion surcharge (typically 1–2%). Stripe allows dynamic currency conversion for international customers at an additional fee. For businesses with meaningful international revenue, pricing in the customer’s local currency and accepting the FX risk is often cheaper than letting the card network convert.
Frequently Asked Questions
-
For recurring direct debit payments, GoCardless Pay As You Go at 1% + 20p (capped at £4) is the cheapest published rate. For one-off card payments, myPOS Online at 1.30% + 15p is cheaper per transaction than Stripe (1.5% + 20p) or Square (1.4% + 25p). The cheapest option depends on your transaction size and mix — at lower average transaction values, the fixed fee component (20p, 25p) matters more than the percentage.
-
Not in the traditional sense. Payment facilitators (Stripe, Square, PayPal) provide their own merchant account infrastructure and include you as a sub-merchant. You do not need to apply separately for a merchant account with an acquiring bank. A dedicated merchant account from a traditional acquirer becomes relevant at high volumes where IC+ pricing saves meaningful money — typically above £50,000/month in card processing.
-
Settlement timelines for UK businesses: Square settles next working day. Stripe settles in three business days standard (instant payouts available for 1%). GoCardless clears in two to three business days. PayPal settles to a PayPal balance immediately, then one to three days to your bank. myPOS settles instantly to the myPOS e-money account, then £1.50 per bank transfer. New accounts with payment facilitators may face extended holding periods during the initial weeks of trading.
-
Yes — Stripe (via Stripe Terminal), Square, myPOS, and Zettle all support both online and in-person payments under a single account, with unified reporting. This is typically the most practical setup for omnichannel businesses, removing the need to reconcile revenue from two separate providers. GoCardless is online and API only — it does not support in-person card payments.
BusinessExpert is a free comparison service. We may earn an affiliate commission if you click through to a provider and take out a product. This does not affect our editorial independence. All rates verified April–May 2026 — confirm current rates directly with providers before committing.