Is Square a good decision for my business?

Posted by Jesse on May 14, 2013 in Featured, General, Payment Processing

Square is a hot company in the world of payment processing.  They offer a simple start-up with a free swiper.  All you need is a smart phone or tablet.  For many businesses that are starting this sounds great.  No monthly fee and you know the processing rate.  No fuss right?

As many businesses have found out though, Square isn’t the best decision.

Square offers 2.75% of volume for all swiped transactions.  Our qualified processing rates can cost as low as 1.25%, but our effective average rate is 1.95%.¹

Let’s looks at some quick math:

For $100 you would pay approximately $1.95.  With Square this would be $2.75.  That is a difference of $0.80.

For $200 you would pay approximately $3.90, with Square this would be $5.50.  This is a difference of $1.60.

For $300 you would pay approximately $5.85, with Square this would be $8.25.  This is a difference of $2.40.

Square has much higher rates for keyed transactions (3.50% + $0.15).  These transactions can also be held for up to 180 days if the total volume is greater than $1,000 in any 30 day period.  Every business that has accepted credit cards knows that sometimes the swiper does work and you have to key in the transaction.  Just because of a technology error your business shouldn’t wait around for their money.

Square does not charge your business a monthly fee, but they also don’t provide you with prompt customer service.  There is not a personal representative assigned to your business.

They don’t provide you a 1099-K filed on your behalf with the IRS allowing you to deduct the cost of processing from your gross revenue.

They don’t follow up with you to ensure you are following best practices to avoid fraud either.

When it comes down to it; Square costs more and gives your business less.

If you are serious about your business take the time to contact us.  You will get to experience how having a dedicated representative’s name, email, and phone number is better than a distribution email address of a company with flashy commercials.

We understand how important saving money and being provided exceptional service matters.

¹ This does vary based on each individual business type.  This data is based a sample of 2 months of swiped processing data across various business with over $4 million in volume processed.  Debit, standard, reward, keyed, and non-qualified card types were used in this average.