Cheap UK Merchant Accounts

Pound coins and credit cards

This article will give you an overview of cheap merchant accounts, the charges associated with them, and how to avoid scams when looking for cheap merchant account options.

Merchant Account Fees

There are different conduits in the way payment is made and received despite all payments being paid by card. For example, paying for something using the Chip and PIN service will be handled in a different way to a transaction being made using the swipe facility - that is using the magnetic strip on the reverse of a credit or debit card. As the transactions are handled differently it follows that the fees to be paid are treated differently also.

As payments are being made all day long and in the sake of an internet business all night long potentially too, these transactions will be charged for per transaction. The merchant account you are using will swap money at the end of the day with the transactional banks. The fees for using a merchant account bank can be quite high as you can imagine. Cards being declined will incur a separate fee otherwise known as a nuisance fee.

Find out more: Merchant account fees

Cardsave WorldPay

WorldPay logo

Cardsave merchant accounts are now controlled by Worldpay, but offer the exact same services that customers are used to. They have a flat rate of £19.99 per month, but their fees are amongst the lowest because they depend on how many payments you actually process. They offer a fixed rate for debit cards and a percentage rate for credit cards, which you can ask about directly as prices are subject to change.

Other cost benefits to Cardsave Worldpay merchant accounts is that their payment gateway is included in your fees, they offer help with PCI Compliance and 24/7 UK-based customer support.

Find out more: CardSave Review, WorldPay Review

Sage Pay

Sage Pay logo

As one of the cheapest options for merchant accounts, Sage Pay offers a flat fee of 40p for debit transactions, and 2.5% for credit card transactions. This does not include a £10 PCI compliance monthly fee and their payment gateway is also a separate fee. You should ask about current rates and total fees when you get a quote for their services.

Find out more: Sage Pay Review

Paypal logo

Paypal offers merchant accounts to businesses in the UK, and has cheap rates available for credit and debit card payments, although not necessarily the cheapest in the market. Standard merchant accounts have a 3.4% + 20p fee for credit and debit card transactions, which can quickly add up if you have low margins and a larger volume of sales.

However, Paypal is known for its reliability, speed for processing, and availability around the world. It's a trusted brand that makes being a small business owner simple.

Scams and Fraud

Scammers and fraudsters are in every industry, there are always people that want to earn a fast few quid. Opening a merchant account is not without its risks. However, if you pay attention to detail and do your due diligence research thoroughly you will be fine.

Check the website has a bona fide http:// address and is not being hosted through a back door website i.e., a Google account or Yahoo. Use a merchant account that has received reviews and make sure you speak with someone face to face if not at the very least over the telephone. Likewise, do not think you need to use the bank you are currently with; you can shop around to get the best account for your business needs.

How to Get a Cheap Merchant Account

If you are setting up a brand new merchant account you will be expected to pay set up fees which currently are in the region of circa £100 to £300. Service charges of around 1.5% to 3% will be placed on all card transactions; this percentage figure will be based upon transactional volume, trading history etc. Debit cards generally attract a fee of around 20p to 50p per transaction, which is quite high, particularly if your business trade is for many small items rather than a few large transactions.

Several businesses put in place a minimum card spend in their shops or establishments for this very reason. There are companies that will source the best merchant account for you and get you up and running, they will then take a fee for providing this service along with an annual contract fee plus a percentage per transaction.

When weighing up your options, don't opt straight off for the account that offers the cheapest rate per transaction, add up ALL the costs you will be charged, as what may look attractive at first glance may not be the whole picture.

Next Steps

If you are interested in hearing more about a merchant account for your business, then fill out the form at the top of this page and a select group of excellent suppliers will get in touch with you.

Find the best merchant account for your company with Expert Market's tailored quote service.