If you are thinking about using Square to process your credit card transactions two important factors to consider are costs and service.
Square charges a flat percentage for each transaction and no other monthly fees. If your credit card sales are less than $2,000.00 per month and if your average transaction is around $10.00 per sale it makes sense to look at Square. Their fee of 2.75% for each swiped transaction works out to a cost of only $0.28 on a $10.00 sale. Since there are no other monthly fees, this would be a savings of at least $0.10-$0.18 per transaction over a traditional debit/credit card processing service.
However, if your average sale amount is $20.00 or higher and you process at least $2,500.00 per month then it makes sense to look a little harder at the numbers. For example, a $20.00 debit card transaction at Square’s rate of 2.75% will cost you $0.55. With a reputable processor that same debit card transaction should cost around $0.42. With a regular processor you would have the monthly fees of $15.00-$20.00 which would cover a Statement Fee, Association Fees, PCI and Regulatory charges.
You should also consider what type of service your company requires. Square requires that you e-mail all questions or concerns because they do not offer any type of telephone customer support. A good processor will go to your office, meet with you in person and assist in evaluating the best options for your business, from POS Systems to Mobile processing and Virtual terminals. If you have a problem with the customer’s transaction unlike Square, you should be able to contact your processor by phone, have them answer the phone promptly (that is a key component) and resolve the problem quickly. Remember it is your customer that is getting their credit/debit card account charged by you and you only want to charge them once for that transaction.
In conclusion if you’re monthly dollar volume and average sale amount are very small, look at Square for cost savings and convenience. But once your numbers grow Square doesn't appear to be the right answer.