Which Is Better for Small Retailers in the PayPal Ecosystem?
The in-person rate is identical, so what separates them is ecosystem fit and how much work the POS app can do, not the price of a transaction.
Square wins if you need a proper POS app beyond a basic till. Square’s free POS handles table management, modifiers, open tabs, split bills, appointment booking (for service businesses), and inventory tracking across multiple locations.
PayPal POS’s app is enough for simple retail and counter service. It becomes the weaker option when you need hospitality tools or management across several locations.
Square also wins if you sell online. Square Online gives you a free e-commerce store connected to the same inventory as your reader, a genuine omnichannel setup. PayPal POS does not have a native e-commerce product. Square’s 1.4% + 25p online rate also beats PayPal POS 2.5% for online transactions.
Visit SquarePayPal POS is the better fit if PayPal already handles your online payments. Card takings reach the same balance within minutes, leaving you with one provider and one pot to manage.
PayPal POS is the wrong choice if you want card takings sent straight to your business bank account. With a PayPal Business account the money reaches your PayPal balance first, and PayPal says automatic transfers to your bank go out the same day. A standalone PayPal POS account pays out within 1–2 business days instead, with no payouts at weekends or on bank holidays.
Visit PayPal POSSquare vs PayPal Point of Sale Fees and Charges
Card Transaction Fees
Both providers charge 1.75% on in-person card transactions, Amex included. There is no monthly fee on either free plan. For a purely in-person business, both providers cost the same.
Monthly, Setup and Contract Costs
Neither Square nor PayPal Point of Sale charges a monthly fee, setup fee, or exit fee on the standard plan, so the only money at risk in trying one is the price of the reader.
Other Fees to Watch
The rates diverge on non-standard transactions: Square charges 1.4% + 25p for online UK-card payments; PayPal POS charges 2.5%. Keyed-in transactions are 2.5% on Square and 3.4% + 20p on PayPal POS. We verified both rate schedules in October 2026.
Fee Verdict: Who Costs Less
| Transaction type | Square | PayPal Point of Sale |
|---|---|---|
| In-person (card-present) | 1.75% | 1.75% |
| Online / payment link | 1.4% + 25p | 2.5% |
| Keyed-in (manual entry) | 2.5% | 3.4% + 20p |
| Hardware cost | £19 +VAT | £29 excl VAT |
| Monthly fee | £0 | £0 |
| Fees verified October 2026. For a purely in-person business, both providers cost the same. | ||
Square vs PayPal Point of Sale Payment Methods and Checkout Options
Cards, Wallets and Alternative Payment Methods
Both providers accept Visa, Mastercard, and American Express in-person at the same 1.75% flat rate, with no Amex surcharge on either provider. Both support Apple Pay and Google Pay in-person. Sellers who joined PayPal POS before 8 May 2023 can also take PayPal app payments in-store by PayPal QR code, at 1.75%.
Checkout Experience
For online payments, Square provides a hosted checkout, embeddable payment form, and virtual terminal. PayPal POS’s online offering is limited to payment links at 2.5% and QR codes at 1.75%, and PayPal says both are closed to new sellers: payment links are currently unavailable to them, and QR codes are only for sellers who signed up before 8 May 2023; there is no native e-commerce product or embedded checkout API.
We confirmed all checkout options against both providers’ published documentation.
Methods Verdict
For in-person payments the two providers are equal. Square wins on online payment flexibility and rate. If your customers want to pay with the PayPal app in-store, PayPal POS supports that through PayPal QR codes, but only for sellers who signed up before 8 May 2023.
Square vs PayPal Point of Sale Hardware, POS and In-Person Payments
Card Readers and Terminals
Square Reader is £19. Square also offers Terminal (£149, standalone touchscreen with printer) and Register (£699 + VAT, customer display built in, full countertop POS). For a growing business that wants to upgrade hardware without changing provider, Square has more headroom.
PayPal POS Reader 2 is £29 for the first unit. PayPal also sells PayPal Terminal, an all-in-one wifi and 4G device from £149 excl VAT, with the printer sold separately. There is no countertop register with a built-in customer display to match Square Register.
POS Software and Hardware Add-ons
Square’s free POS app adds table mapping, kitchen display integration, appointment scheduling, team permissions, and a loyalty programme. The gap matters most for restaurants, salons, and multi-staff businesses.
PayPal POS’s app handles products with low-stock alerts, discounts, cash tracking, reports for each location and loyalty vouchers. For a market trader or a mobile hairdresser, both apps do the job. For a busy restaurant or a retailer needing complex order customisation, Square’s free tier goes further.
In-Person Verdict
We rate Square’s hardware upgrade path as a genuine advantage for businesses expecting to grow beyond a single reader. PayPal POS covers simple counter service at a £10 hardware premium over Square.
Square vs PayPal Point of Sale Online Payments and Integrations
Hosted Checkout, Payment Links and APIs
Square Online provides a native e-commerce store at no extra cost. PayPal POS does not have a native online sales product. For a business that needs both in-person and online payments under one account, Square is the simpler path.
Platform Integrations
Both platforms sync with accounting software. Square integrates with Xero, QuickBooks Online, and cloud Sage Accounting (an official free Amaka integration, checked October 2026). PayPal POS lists Xero and QuickBooks Online among its accounting integrations, but not Sage or FreeAgent.
Businesses managing staff shifts or several locations get more useful reporting from Square. We put it ahead because its reports cover product performance, employee sales, shifts and results across locations.
Online Verdict
Square leads online on rate, native store, API depth and reporting. PayPal POS can connect to Shopify or another existing store, but Square gives a business starting from scratch the simpler route.
Square vs PayPal Point of Sale Payouts, Contract Terms and Account Risk
Settlement Speed and Payout Schedule
Square settles to your linked UK business bank account within 1–2 working days. Instant transfers are available at 1.5% of the payout amount.
PayPal POS settles to your PayPal balance in minutes. Moving that balance to a bank account is an additional step. PayPal says automatic transfers reach your bank within the same day, or within two hours if you move the money by hand. A standalone PayPal POS account, not linked to a PayPal Business account, pays out within 1–2 business days instead, with no payouts at weekends or on bank holidays.
Contract Length and Exit Terms
Neither provider requires a contract. Both can be cancelled at any time with no exit fee.
Reserves, Holds and Account Stability
A PayPal account limitation can block access to PayPal POS takings as well as the wider balance. We rank that shared dependency as its main operational disadvantage against Square.
Square vs PayPal Point of Sale Customer Reviews and Reputation
Trustpilot and Independent Review Themes
Square has a long UK track record since launching in 2017. Trustpilot UK reviews reflect consistent praise for the POS software and complaints centred on account risk holds.
Support Channels and Response Times
PayPal Point of Sale has operated in the UK market since 2012 (originally as iZettle). User reviews on Trustpilot UK are generally positive for hardware reliability. Negative reviews focus on customer service response times and occasional PayPal account restrictions affecting PayPal POS settlement.
Reputation Verdict
On reputation alone there is little to separate them. Both have traded in the UK for years (PayPal POS since 2012, when it was iZettle, and Square since 2017), both are rated well for hardware and for how quickly you can get selling, and both draw the same complaint about funds held during an account review with slow going to get them released.
What differs is how far a hold reaches. A Square hold sits on your card takings and nothing else. A PayPal limitation sits on the whole balance, so a dispute raised over something you sold online can also stop you spending yesterday’s counter money, because the two share one pot. Weigh that before you pick PayPal POS for the speed of its settlement.
Square vs PayPal Point of Sale for POS Software Depth
Your choice changes once the till needs to do more than take a payment. Square covers more of the work around each sale, while PayPal POS remains a simpler checkout tool.
Square’s free POS can manage modifiers, variants, tables, open tabs, split bills and staff permissions, as well as appointments, loyalty and kitchen displays. That is enough to run a restaurant, cafe, salon or retail counter without immediately adding paid till software.
PayPal POS covers product catalogues with low-stock alerts, discounts, cash tracking, sales reports for each location and a loyalty voucher scheme, which is enough for straightforward counter service. Table management, modifiers, kitchen displays and appointment scheduling are not on PayPal’s POS pages.
For a mobile trader selling from a van or a sole trader with a straightforward checkout, the POS difference is irrelevant. For a cafe operator managing tables and orders, Square’s free tier is meaningfully superior.
Hospitality and multi-staff businesses have a clear reason to choose Square. We put it ahead because table management and staff permissions are included without a software subscription.
Downsides of Square and PayPal Point of Sale
Downsides of Square
Square’s 1.75% flat rate becomes expensive at high volume. Businesses processing more than £200,000 a year should negotiate a custom rate or consider alternatives.
Account holds are a recurring complaint on Trustpilot, though this affects most large processors. International card acceptance at 3.25% is expensive for tourist-facing businesses.
Downsides of PayPal Point of Sale
The online rate (2.5%) is higher than Square’s (1.4% + 25p).
Hardware is £10 more expensive than Square for the first reader. The POS software does not match Square’s depth for hospitality or multi-location businesses.
Alternatives to Square and PayPal Point of Sale
Look beyond both providers if lower transaction fees or a standalone mobile terminal matter more than software depth:
- SumUp, 1.69% flat, £15 reader. Cheaper rate and hardware than PayPal POS; simpler than both.
- Lopay, 0.99% next-day, £24 reader. Significantly cheaper for businesses without Amex volume.
- myPOS Go 2, £39, standalone 4G, 1.10% + 7p on Visa and Mastercard. Better for outdoor and mobile trading.
- Dojo Go, Standalone 4G terminal with a 1.2% blended rate below £100k annual card turnover, custom above.
Final Verdict: Square or PayPal Point of Sale?
Choose Square if you need hospitality POS features, sell online, or want settlement direct to a business bank account. The free POS, £19 reader, and 1.4% + 25p online rate make Square the more versatile choice for any business with a meaningful online or multi-function till requirement.
Choose PayPal Point of Sale if PayPal already handles your online payments and you want in-person card acceptance under the same provider.
Settlement into your PayPal balance is useful when that is already where the business receives most of its money. The software remains best suited to simple counter service rather than a till with hospitality or multi-location demands.
For a purely in-person business with a simple checkout and no online sales, both providers cost exactly the same. The £10 hardware saving from Square and the deeper POS app are the tiebreakers in that scenario.
Frequently Asked Questions
Is Square or PayPal POS cheaper?
They charge you the same in-person rate (1.75%). Square is cheaper if you also sell online (1.4% + 25p vs PayPal POS 2.5%). Hardware is £10 cheaper on Square. For a purely in-person business with no online component, they cost you the same.
Does PayPal POS have a free POS?
Yes. PayPal POS software is permanently free and covers products, stock alerts, discounts, location reports and loyalty vouchers. Square’s free software goes further, adding features such as table management and appointments.
Can I switch from PayPal POS to Square?
Yes, with no penalty. Neither provider locks you in on the base plan. You will need to buy new hardware (£19 for a Square Reader) and move your product catalogue, but there is no exit fee and no notice period.
Does PayPal POS accept Amex?
Yes. PayPal POS processes American Express at the same 1.75% flat rate as Visa and Mastercard, with no Amex surcharge. Square matches this. If your customers pay you with Amex regularly, you will not pay a premium on either provider.
How we reviewed Square vs PayPal POS
How we compared them. We priced both providers from their own published pricing pages and product documentation, then set the two settlement routes side by side: Square to your bank account, PayPal POS to a PayPal balance you then move on. This is a documentation-based comparison, not a device test.
What we checked. We pulled every fee, hardware price, and settlement term straight from Square’s and PayPal’s own pricing pages in October 2026.
Update cadence. We re-check both providers when either changes pricing, eligibility or terms, and the date on the page reflects the most recent full review. Some links on this page are affiliate links; see our editorial policy.