Getting paid is the ultimate goal of any business. All of the marketing, top-tier customer service, employee training, and hard work is meant to generate revenue and make a business successful. In the past, cash was king. As our reliance on technology continues to grow, however, and we become more mobile than ever, people are choosing to pay with credit cards or their smartphones more and more often. 

In fact, about 70% of all transactions in the United States today are done as cashless transactions. More importantly, that number continues to grow. As such, it’s easy to see why having the ability to accept all payment types is important for any growing business.

Thankfully, there are a number of great options for businesses of all sizes to consider when they want to enable mobile payment processing. Not only does this allow businesses to collect payments in a range of payment methods that are convenient for their customers, but it also enables businesses to cut the tether from their storefront locations and old point of sale systems, and do business wherever they would like. Of course, there are also businesses that are entirely mobile, like food trucks, where mobile payment processing is the only solution for accepting non-cash payments.

While mobile payment processors have made it easy for businesses on-the-go to accept all types of payment, the challenge for many businesses is choosing the right provider. What features are important? How does pricing work? What are the drawbacks of choosing mobile payment processing? 

All of these questions can weigh heavily on small and medium business owners that are trying to complete their day-to-day duties in addition to worrying about payment processing. This article discusses the features and benefits of mobile payment processors, provides helpful tips for making the right choice, and allows business owners to comfortably embrace the future of payments while providing better service to customers.

Why do businesses need mobile payment processing?

Cashless payment methods are rapidly becoming more and more popular in the United States. It may come as a shock to some, but the United States actually lags behind other countries in cashless payment adoption. In Sweden, for example, the country is expected to be entirely cashless by 2025, with just 1% of transactions using cash. This is an extreme example, but it points to how people around the world will pay for things in the future. 

Simply put, businesses that don’t accept cashless payment methods will soon see their customer base shrink, year after year, as fewer people carry cash with them. This means turning away sales, missing out on revenue, and failing to remain profitable. So one of the main reasons businesses should consider mobile payment processing is because cash is quickly becoming a less popular way for customers to pay when out shopping.

Another major advantage of choosing mobile payment processing is that it’s more cost-effective for small businesses than signing a contract with a payment processing company through a financial institution. Machine rentals from many payment processors can cost hundreds of dollars per month, in addition to processing fees. 

For businesses that don’t have the volume to justify an expensive payment processing machine, mobile payment processors are a great solution. Plus, they typically don’t require businesses to sign contracts, which offers more flexibility in the future should the needs or transaction volume of the business change.

Mobile payment processing also gives businesses the ability to pursue new avenues for sales. On-site sales representatives, like those that may visit a customer’s home, can instantly take payments for services instead of invoicing clients and waiting for the payment to come through. This can instantly increase the cash flow, while also providing better customer service at the time of delivery. Businesses can also participate in events like public markets, trade shows, and festivals without having to settle for only collecting cash from potential customers. The possibilities when using mobile payment processing don’t stop at the front door of the store.

When do businesses need mobile payment processing?

There are a few scenarios in which business owners and operators might find themselves exploring mobile payment processing options. 

One of the most obvious times when a business should consider mobile payment processing is when it’s just launching. For new businesses, being able to accept payments affordably is incredibly important to success. New businesses often don’t have the volume of transactions or the need for an expensive payment processing service. Plus, they want a service that’s easy to set-up, maintain, and use while the focus on all of the other aspects of their business. New businesses also may not have a permanent physical location on launch depending on their needs and budget, which can make getting a traditional merchant account difficult, if not impossible. 

Another time businesses should look into the benefits of mobile payment processing is when they find that their current payment processing service is no longer working for them. Traditional payment processing providers have costly contracts and equipment that don’t offer nearly the level of flexibility as mobile payment processing. The costs of these traditional credit and debit payment terminals can greatly exceed the costs of a simple mobile payment processor unless the business does a large volume of transactions.  When a contract with a payment provider is coming due, it’s always wise to at least research alternative options to ensure the existing payment provider is living up to their end of the deal, and that there aren’t other better companies more suited to that specific business’s needs.

Finally, businesses that are exploring new avenues of business that don’t include their standard storefront location may identify a need for mobile payment processing. Restaurants launching a food truck or delivery service are great examples of this. Retailers may wish to visit trade shows where they need a flexible payment solution for customers. Service providers like plumbers or electricians that make home visits may want to simplify and streamline their invoicing system by offering instant payment at the door. 

All of these are great examples of changing business practices that may necessitate the need for a mobile payment processing option.

How to choose a mobile payment processor – and what to look for

There are a number of companies that offer mobile payment processing services. So, how do businesses determine which option is best? What separates one payment processor from another? Making the right choice here can have a huge impact on the costs passed along to the business and the level of service they are able to provide to their customers.

The first and most important feature to look for is how payments can be processed. Mobile payment processors come in two different forms:

  • A standalone mobile card reader or terminal 
  • An accessory-style terminal that plugs into a connected device like a tablet or smartphone 

Standalone readers tend to have a higher upfront cost but often enable additional payment options like a reader for chip cards as well as Apple Pay or Google Pay support which require NFC capabilities. Some of the accessory-style readers that plug into a smartphone only read a magnetic stripe once you swipe it, and won’t allow a customer to pay with their smartphone wallet, for example. Offering customers more ways to pay beyond just their card with a magnetic stripe or EMV chip can cast a wider net for sales, but it may also cost more money as well.

The type of business being operated and the specific use case for the mobile payment processor should also be an important factor to consider when choosing the style of terminal being used.

For example, a company with a rep doing door-to-door sales may want to opt for a more affordable mobile credit card reader that can attach to their employee’s Android and iOS smartphones for ease of use. This would minimize upfront costs, as well as lower the cost should a mobile terminal be lost or damaged.

A smaller business looking for a single terminal to be their main option, like in a food truck scenario, may wish to go with a full-featured option that costs more upfront but provides more payment options for customers than just credit cards.

One thing that often goes overlooked when choosing a mobile payment processor is the type of cards the processor can accept. Some of the more basic mobile payment processors only accept credit cards which leaves debit card users out in the cold. For a business, this can mean lost sales opportunities.

In addition, some processors may only accept Visa and Mastercard which leaves other credit card companies like AMEX and Discover unsupported. For some businesses, this may be a risk they are willing to take, while others may want to support all types of cards from all different banks and providers. Doing the right amount of research beforehand, as well as considering the pros and cons of each choice, can help lead to an informed decision.

Many mobile payment processing companies will also provide additional features that go over and above just basic payment processing. For example, some companies allow businesses to set up inventory tracking, barcode scanners, receipt printers, and even in-store terminals that bring their mobile operation together with their brick and mortar setup. These extra features can be very handy, especially for businesses that are getting started and have no previous agreement or equipment to handle these other aspects of their business. Of course, many of these features can come with an additional cost which must be weighed against the potential benefits of having a single, integrated system for payments, inventory, and more.  It all boils down to business needs.

Also keep in mind that a mobile payment processor should follow all the regulations to ensure PCI compliance, as well as handle some basic bookkeeping tasks. Being able to email receipts to customers and track sales, with reports provided to the business, is at minimum what a business should expect from their mobile payment provider. Some payment terminals can take things a step further by managing the product catalog, tracking tips for employees, and more. For business owners that want to simplify and streamline their bookkeeping, they may wish to opt for a mobile payment processor that includes these features. 

Of course, one of the most important factors to consider when it comes to any type of payment processing is the cost to the business.

Check out our roundup of the Best Mobile Credit Card Readers

How does pricing work for mobile payment processing?

Being able to accept mobile credit card payments is nice, but what is the cost of doing so? 

If the cost of processing cards adds up too quickly, then there is no real benefit for a business to offer this service to their customers. Luckily, mobile payment providers have come to market with a competitive rate and set of features that most business owners should be able to take advantage of, while still turning a profit. 

There are a few different ways businesses can incur a cost when using a mobile processing solution.

The first cost for these services is the upfront cost, which will vary from provider to provider based on the type of equipment being used, as well as the additional features being chosen.  Generally speaking, most mobile payment providers do not have significant setup fees or iron-clad contracts. 

With that said, some providers may have a small upfront setup fee, as well as fees for issuing payment terminals. The cost for terminals can vary anywhere from no cost at all to a few hundred dollars, depending on the features packed into the terminal. Free terminals will usually plug into a smartphone or tablet and only offer magnetic stripe reading capability while more expensive terminals may include a chip and pin reader, NFC connectivity, and built-in 3G or 4G.

The main cost that most businesses will be concerned about is the fees incurred for each transaction. These costs can vary from provider to provider but generally begin with a flat fee plus a percentage of each transaction. This percentage usually ranges anywhere from 2% to 4% and may depend on the type of transaction being processed. Some payment processors may opt to eliminate a flat initial fee and, instead, just charge a higher percentage on each purchase. These costs are very transparent from provider to provider and easy to compare when making a decision.  

Finally, the other common fee to consider when choosing a payment processing provider is the monthly or annual fee. Some providers do not charge a regular monthly or annual fee while others do. For businesses with a higher volume of transactions, paying this fee may be worth it as the providers with regular fees tend to collect less of a transaction percentage for each sale. Plans can also vary from provider to provider and some providers may even have multiple tiers. It’s important for businesses to consider the entire range of features they get for their fees as well as the volume of expected transactions. For example, a $20 monthly fee may seem steep compared to a no-fee provider but the lower transaction fees may more than makeup for that difference.

Now that you know what to look for in a mobile payment processor, it’s time to compare the main players in the industry. 



Square logo

Square is arguably the best-known name in mobile payment processing and that notoriety is completely deserved. In many ways, their basic magnetic stripe terminal – which attaches to smartphones, tablets, and iPads – has revolutionized and set the standard for mobile payments. Businesses can use Square with no monthly fee and just pay the low cost per transaction instead. In addition to basic payment processing, Square also offers customers advanced solutions like e-commerce support for online stores, desktop payment terminals, and niche products like POS systems designed specifically for retail and restaurants. 


Quickbooks Intuit GoPayment


Quickbooks Intuit GoPayment brings together mobile payment processing with the power of Quickbooks accounting software. For business owners that want simple management of payments and accounting in one solution, this may be it. The card readers are free for new users and support chip and magnetic stripe payments. Unfortunately, however, NFC is not currently supported. Users can choose between a free monthly plan with higher transaction fees, or pay $20 per month for lower fees. This is where Quickbooks GoPayment falls behind the competition. The fees may be worth it for the simplicity of the Quickbooks integration, but they are not competitive with other options when it comes to costs. The service also lacks additional features like POS terminals and inventory management.


PayPal Here

PayPal logo

PayPal Here is PayPal’s attempt to break into the physical payment space. Everyone already knows the PayPal name for online shopping and online payments, and their PayPal Here product builds on that experience. The sleek payment terminals are affordable and the pin pad model can accept chip and pin, NFC, or magnetic stripe payments. PayPal Here also offers more advanced POS solutions with features like product management and inventory tracking but that offering lags well behind more experienced players in that space like Square and Shopify, for example. For basic payment processing, however, PayPal Here is an affordable option that checks off the most important boxes.


Dharma Merchant Services

Dharma logo

Dharma Merchant Services is a lesser-known name in payment processing when compared with the likes of Square or PayPal but it is definitely not a name that businesses should ignore. Their $20 monthly fee may seem higher than the competition but that difference is quickly made up with the lower transaction fees. High volume stores that do more than $100,000 per month get discounted monthly rates and fees which can make a massive difference in costs for businesses. Dharma does lack some of the advanced features of other providers that extend beyond just payment processing but, as strictly a payment processor, it’s hard to beat the costs associated with using Dharma especially if you’re operating a high volume business. 


Chase Merchant Services

Chase logo

Chase is a very popular name in the payment processing industry. They offer both traditional and mobile payment processing services which makes them a smart option for mobile payment services if a business is already using their traditional payment processing. Their mobile processing service offers additional functionality for businesses on-the-go including catalogs, email or text receipts, searchable transaction reports, and more. Their fees are higher than some competitors but the integration with the other Chase Merchant Services means that businesses may find this is one of their most convenient options. 



Shopify logo

It’s hard to find a more well-known name in e-commerce than Shopify. For businesses already using the Shopify platform, using Shopify payments is the logical next step. The various plans from Shopify offer very competitive pricing with low monthly fees as well as low transaction costs. Where Shopify sets their offering apart from the competition is the additional features. Even on the lowest plan available, users can make use of the Facebook Buy Button and enjoy live chat or email support. On higher-tier plans, users can also integrate their inventory into Shopify, add a POS terminal for brick and mortar sales, and access advanced marketing tools. The full suite of Shopify products is what makes using Shopify payment processing a good choice for businesses of all sizes.



EMSPlus combines a smartphone or tablet app with their mobile payment processor, much like the other providers on this list. Using the EMSPlus Merchant Gateway, businesses can sort transactions, manage inventory, and generate reports. The Bluetooth receipt printer is a nice, but costly, addition at $399. Fees for EMSPlus are competitive with other offerings and the interface is simple to use when processing payments on-the-go. The merchant portal does appear more dated and cumbersome than more advanced competitors but it gets the job done and enables businesses to take control over their transactions. Report generation tools are included which makes monitoring transactions simple.



Payanywhere logo

Payanywhere offers both brick and mortar as well as mobile payment solutions. For businesses with less than $5000 in monthly sales, the POS terminal may prove to be more than they need as the costs would be more efficient with the mobile payment solution. The basic payment processing plan comes packed with features like custom discounts, tipping, a customer database for future marketing, Quickbooks integration, and more. Businesses can create unique roles for multiple users which gives specific permissions to employees based on their position. The fees are lower than many competitors but the monthly cost is higher than some of the more affordable options. For high volume businesses, Payanywhere could be a money-saving option when compared with other free or low-cost competitors.