It’s hard to argue against the benefits of accepting credit cards and contactless payments. Modern payment systems enable businesses of any size to sell across multiple channels and offer convenient electronic payment options. After setting up an account, you can get paid via credit card, even without a website or card reader.
This guide breaks down the cheapest and easiest ways to accept credit cards online, in person, or over the phone. See what software and equipment you need, then learn how to accept credit card payments as a small business or freelancer.
What every small business needs to accept credit cards
To accept credit card payments, a small business needs a payment processor, merchant account access, and the hardware or software to securely capture transaction data. You’ll also need a business bank account to receive settled funds and a reliable internet connection for real-time authorization.
Regardless of your setup, you must comply with the Payment Card Industry Data Security Standard (PCI DSS). These rules govern how cardholder data is stored, processed, and transmitted.
How to accept credit card payments, step-by-step
The steps to accepting business credit card payments include choosing a setup, comparing processing providers, and establishing an account. Configure your payment system by downloading mobile POS apps and connecting hardware. Explore each step in depth below.
1. Assess your credit card processing requirements
Evaluate how your business accepts payments and typical transaction volumes. Your answers will influence pricing and hardware requirements, helping you choose between merchant account providers, payment aggregators, and PSPs.
Consider the following:
- Where do you process most transactions (in-person, online, or over the phone)?
- Do you want to accept all major credit cards (Visa, Mastercard, American Express, Discover) and digital wallets, like Google Pay?
- What is your average transaction size?
- Is your business considered high risk?
- Will you need ACH payments for high-value invoices?
- Do you anticipate monthly card volume exceeding $10,000?
- What hardware, if any, will you need for in-person payments?
- Do you expect international payments or require multi-currency support?
- Do you need your payment processor or gateway to integrate with an existing website or POS system?
2. Choose your payment acceptance setup
Look at various setups to determine which credit card processing components and services you need. Common payment stacks include all-in-one payment platforms, a traditional processor and merchant account, or as-needed tools such as a payment gateway, a point-of-sale system with processing, or subscription management and invoicing software.
See how these payment acceptance tools and systems compare:
- All-in-one payment service providers: A single platform with a gateway, processor, and merchant account access. PSPs like Square or Stripe typically use a payment facilitator or aggregator model, so you can accept credit cards under a shared merchant account.
- Payment gateway: A front-end payment acceptance interface like Authorize.net that routes transaction data from your POS system, e-commerce platform, or website to a third-party processor like Chase Payments.
- Merchant services provider: A payment processor that may provide a direct merchant account and other services like a gateway, POS, and invoicing.
- Merchant account provider: A financial institution (acquiring bank) that sets up a dedicated account on your behalf to receive customer payments and transfer funds to your business bank. You may also need a processor if using a local credit union or bank.
- E-commerce or invoicing tools with processing: Software with built-in payment processing and merchant account access via shared master accounts. Examples include QuickBooks, Shopify, and Wave.
- Point-of-sale system with processing: Service, retail, or restaurant POS software and hardware with integrated payment processing or a third-party processor. POS providers (Lightspeed and Clover) and some processors (Helcim and Square) offer these services.
All-in-one PSP platforms work well for startups, service providers, and businesses with low to moderate monthly income. Companies with higher monthly sales, larger average tickets, or higher-risk classifications may prefer traditional processors and separate stacks (like a gateway through your bank paired with an MSP processor).
3. Compare payment processors, merchant services, and pricing models
Once you’ve determined your ideal setup, look at payment processors and merchant services to compare software, hardware, and pricing models.
While many small business payment processors have similar rates, even small differences in percentage rates or per-transaction fees can significantly impact your total costs. Pricing structures include flat-rate, interchange-plus, and subscription-based models.
Create a mock sales scenario using your estimated monthly volume and average ticket size. Then calculate projected fees for each provider.
Beyond cost, compare:
- Funding speed.
- Contract terms.
- Integration capabilities.
- Chargeback support.
- Customer service.
- Hardware pricing.
- Invoicing, POS, and recurring revenue tools.
4. Choose a credit card processor and open an account
Once you've compared vendors to find the best credit card processing provider for your small business, it's time to apply. Many services offer online applications. Payment facilitators and aggregators like PayPal approve applications almost instantly, while traditional merchant account providers may require underwriting review.
Complete the application process by providing your contact details, EIN number, and bank account information. You may need to estimate your monthly transaction volume, list what industry you’re in or what products or services you sell, and what your average transaction amount is. After the processor approves your application, you can sign in to your account.
5. Configure your hardware, software, and integrations
To begin accepting credit card payments online, over the phone, or in person, you must configure your account and any hardware. Set up payment tools based on how and where you sell, then test your system before accepting credit cards from customers.
You can configure the following:
- In-person payments: Install EMV terminals, mobile card readers, or POS hardware and software.
- Online payments: Connect your payment gateway to your e-commerce platform or enable hosted checkout pages.
- Mobile payments: Download your provider’s mobile app and pair any card readers.
- Phone payments: Set up the virtual terminal for manually keyed transactions.
The process is straightforward for small businesses using a smartphone to take payments. It involves downloading the payment app and completing the signup process. Tap to Pay works on Apple devices, and you can add mobile card readers to accept credit cards via contactless tap, swipe, or inserted chip.
E-commerce configurations can be more complex, depending on your website, processor, and online payment gateway. Your provider should offer technical support, and your e-commerce software may also have tutorials.
6. Activate fraud prevention and compliance tools
Before going live with your system, confirm that your security and compliance settings are configured correctly. Most providers assist with PCI DSS compliance, so review vendor resources to see if you need to complete a questionnaire or address other security issues.
Depending on your business model, you may also set up or look over the following:
- Address Verification Service (AVS): Enable AVS in your merchant portal to verify the cardholder’s billing address when accepting credit cards over the phone or online.
- Card Verification Value (CVV) checks: Turn CVV on to request the three- or four-digit code during in-person or online checkout.
- 3D Secure authentication: Consider enabling extra authentication via 3DS. Using this fraud tool may reduce your chargeback liability.
- Chargeback monitoring tools: Look under the risk and fraud section in your payment dashboard to activate alerts, or use third-party services such as Ethoca Alerts or Verifi CDRN.
- Clear refund and return policies: Review in-store and e-commerce refund policies to ensure the information is easy to find and understand.
Fraud prevention tools are especially important for card-not-present transactions, which carry higher risk and processing costs.
Processing fees vary by provider, pricing model, and whether your transactions are card-present or card-not-present. The total per transaction can range from 1.5% to over 3.5% plus 10 to 40 cents.
How long does it take to start accepting credit cards?
Most small businesses can start accepting credit card payments within one to five business days, depending on the provider, underwriting requirements, and whether hardware is required. Payment aggregators like Stripe or Square offer instant or same-day application approvals.
Traditional merchant account providers take longer due to more stringent underwriting. Incomplete applications can delay approvals, as can complex business structures or high-risk merchants.
Once approved, you can almost immediately accept payments through the provider’s POS software, mobile app, or virtual terminal. Equipment, like physical card readers and POS terminals, typically arrives a few days after your application is approved.
Best ways to accept card payments for small businesses
The best way to accept card payments depends on where and how you sell. Today, many small businesses accept payments online and in person, using a combination of methods to meet customer preferences and improve cash flow.
Credit and debit cards make up the bulk of purchases. A 2024 Federal Reserve study showed that 62% of all payments were made by debit and credit cards (32% credit and 30% debit). But when choosing payment acceptance methods and merchant services, consider digital wallets and alternative non-bank solutions, like buy now, pay later (BNPL) services.
Explore the best ways to accept payments in person, online, and on the go.
Process in-person payments
To accept card payments in person at restaurants, retail stores, or other physical locations, you can use a stand-alone credit card machine (EMV-compliant) or a POS system with an integrated payment terminal. Many setups also support wireless or handheld devices for curbside pickup or tableside service.
This method is ideal for businesses that:
- Operate from a storefront or fixed location.
- Need inventory tracking and sales reporting tools.
- Want integrated tipping and receipt management features.
The payment acceptance process varies slightly, depending on the hardware and POS features. In most cases, you can process in person payments by calculating the sales total, selecting the payment method, and asking the customer to insert, swipe, or tap their credit card. Retail and restaurant POS systems often include receipt printers, so have your customer sign the paper receipt or the on-screen display, if required.
Use your mobile device to take payments
For many startups and freelancers, mobile payment processing is the easiest way to accept credit cards. With tap-to-pay functionality, your tablet or smartphone turns into a contactless terminal, allowing any staff member with a phone to process transactions on the go.
Providers also offer Bluetooth card readers, QR codes, or mobile POS applications for extra flexibility. These options help small businesses accept digital payments anywhere, not just at a storefront.
This payment method is popular among:
- Contractors and field service providers.
- Delivery drivers.
- Food trucks and pop-up vendors.
- Event-based businesses.
- Startups without a permanent location.
To use your mobile device to take payments, download your provider’s mobile POS app, and connect a card reader or enable tap-to-pay functionality.
Accept a credit card payment online (with or without a website)
Businesses can accept a credit card payment online through an e-commerce checkout page, hosted payment link, or invoicing platform. Online payments rely on payment gateways to securely transmit card data.
This method works well for:
- E-commerce stores.
- Consultants and freelancers.
- Service providers who send invoices.
- Businesses that collect deposits or prepayments.
To accept a credit card payment online, integrate a payment gateway with your website, e-commerce platform, or invoicing software. If you’re looking to expand your business to new channels but lack an e-commerce presence, select a payment processor that provides website tools for building online stores and checkout pages.
Take payments over the phone
When customers want to pay over the phone, you can process transactions through a virtual terminal or POS system. Mail order and telephone order (MOTO) payments require you to manually enter card data, which classifies transactions as card-not-present and generally costs more than in-person payments.
This payment acceptance method is useful for:
- Collecting past-due invoices.
- Taking reservations or deposits.
- Processing delivery or custom orders.
To take payments over the phone, generate a sale through a virtual terminal or POS system. Follow the on-screen instructions to key in customer and payment information. Confirm the billing details before submitting the payment. Consider using AVS and CVV checks when available.
Collect recurring payments
Many businesses use recurring payment tools to automate subscription charges and membership fees. These systems store card details securely and process scheduled payments without manual invoicing. Automated retries and billing reminders help reduce failed payments and stabilize cash flow.
This method is common for:
- Subscription services.
- Membership organizations.
- SaaS providers.
- Fitness studios.
Set up recurring payments through your processor, then follow the steps to create a subscription plan and define billing intervals (monthly or yearly). Depending on the system and your business model, customers may sign up online, or you can obtain authorization in person.
Card-present vs. card-not-present transactions
Every credit card transaction falls into one of two categories: card-present or card-not-present. A card-present transaction occurs when the customer physically taps, dips, or swipes their card (or contactless device) at checkout. Because the card and cardholder are verified in real time, transactions usually have a lower fraud risk and cheaper interchange rates.
A card-not-present transaction happens when the card isn’t physically available, which is common in e-commerce purchases, invoices, subscription billing, keyed-in payments, and MOTO transactions. These payments carry higher fraud risk and typically cost more to process because the processing provider can’t verify the physical card.
Credit card processing fees and costs for small businesses
Processing fees vary by provider, pricing model, and whether your transactions are card-present or card-not-present. The total per transaction can range from 1.5% to over 3.5% plus 10 to 40 cents.
When a business processes credit card transactions, it pays fees to the card networks (Visa, Mastercard, American Express, and Discover), issuing banks, and the merchant account provider. The cheapest way to accept credit card payments is typically through chip or contactless card-present transactions using an EMV terminal.
Vendors may charge additional fees for virtual terminals, payment gateways, and other services. Make sure you understand common terminology and read the fine print before signing contracts. After setup, look over your monthly statements to catch any hidden charges.
Comparing payment processors and merchant account providers
Modern payment systems and processors offer multichannel processing. However, some include additional fraud tools or e-commerce or better invoicing templates for service providers. Explore top credit card processors for online, in-person, and recurring payments.
Best for e-commerce
The top online payment processors offer robust fraud and chargeback protection tools. Verify the system integrates with existing software and delivers a fast, seamless checkout process.
- Shopify Payments: One vendor solution for your online shop and digital payments.
- Stripe: Robust fraud tools and extensive APIs for website integration.
- PayPal: Installment payments, Venmo, or online checkout.
- Stax: In-depth reporting tools and integrations with major e-commerce platforms.
Best for in-person retail
For brick-and-mortar shops, choose payment setup options that align with your layout (counter vs. mobile) and technology stack, including existing inventory management tools and POS software. Vendors may offer point-of-sale systems, and most include e-commerce functionality, but you may pay gateway fees.
- Helcim: POS software, customer database, and in-store or online payments.
- Clover: Lease or buy durable POS hardware and software with built-in payments.
- Square: Fast application approvals, iPad-compatible, and free in-person and online tools.
- Payment Depot: Smart terminals or card readers to process purchases at your shop.
- ProMerchant: Connect in-store payment terminals to your existing system.
- Merchant One: Receive payments with mobile devices, hard-wired terminals, or online.
- Lightspeed Payments: Sell almost anywhere, including in-store and on social media.
Best for recurring billing
Invoice, subscription management, payment processors, and other software may offer built-in recurring billing features. Look over the authorization process and fee structure to compare costs and ease of use.
- QuickBooks Payments: Custom schedules, automated billing, and card update reminders.
- Chargebee: Comprehensive subscription management and recurring billing features.
- GoCardless: Automates direct debit and ACH billing for local and global clients.
- Hubspot Payments: Collect one-time and recurring payments through invoices.
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