What’s Best - PayPal, Square Up or a Merchant Account?
Based on analysis completed over the last few months we have developed an easy to follow guide which will help your business determine the best credit card processing solution given your specific needs. Each credit card processing solution has strengths for specific situations.
When considering which credit card processing solution is the best it is important to start by asking 2 questions:
- Is your business conducting sales face to face or over the internet?
- What is the average credit card volume on a monthly basis?
With answers to these 2 questions we are able to guide you to the perfect credit card processing solution for your business.
Is your business conducting sales face to face or over the internet?
If you are conducting face to face sales it makes more sense to consider the Square Up solution or a merchant account. The reason, Square Up and a merchant account offer your business the ability to swipe the customer’s credit card. This function lowers the credit card processing rates dramatically. PayPal does not offer a swipe solution so it is not a good fit for face to face sales.
If you are conducting sales over the internet, you should consider PayPal or a Merchant Account. The reason, PayPal and a Merchant Account offer a payment gateway that can be used to connect your businesses website to a credit card processing platform. Square Up does not offer a payment gateway so it is not a good fit for internet based sales.
What is the average credit card volume on a monthly basis?
Now that we have determined the best solutions given the manner in which the sale is conducted, we will now look at the total monthly volume to narrow our selection even further.
For face to face sales with an average monthly sales volume below $4,300 the best solution is Square Up. Square Up’s fee structure is set up to be very cost effective for face to face sales under $4,300 a month. When the sales volume exceeds $4,300 a month then an actual Merchant Account becomes more cost effective than Square Up.
For internet sales with an average monthly sales volume below $2,000 the best solution is PayPal. PayPal’s fee structure is set up to be very cost effective for internet or ecommerce sites with sales under $2,000 a month. When the sales volume exceeds $2,000 a month then an actual Merchant Account becomes more cost effective than PayPal.