Square Fees and Rates: What Will This POS Cost You?

Maddie Shepherd

Contributing Writer at Fundera
Maddie Shepherd is a former Fundera senior staff writer and current freelance writer. Maddie has an extensive knowledge of business credit cards, accounting tools, and merchant services, but specializes in small business financing advice. Maddie has a bachelor's degree in Spanish and Latin American cultures from Barnard College.
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If you’re in the market for a point of sale system, you’ve likely heard of Square Point of Sale (POS). With their sleek design and high-tech capabilities, Square POS systems have become a fixture in the small business point of sale market.

But like most small business owners, you’re probably wondering what you’ll have to pay to access a Square POS system. Your cost of using a Square POS depends on your business’s needs and preferences. Therefore, let’s get a better idea of what kind of fees Square will charge you based on the point of sale solutions your business requires.

Here’s your ultimate resource to the Square fees you could potentially be charged.

Understanding Square Fees

Like most pricing models for POS systems, the price you will pay to use Square POS is multifaceted. In other words, there isn’t a cut-and-dry answer to the question of how much are Square fees.

That said, because Square offers transparent pricing for its POS and payment processing services, it is relatively simple to determine what kind of Square fees you could face. 

square fees

Square Fees: Three Categories

Square fees can be broken down into three categories—Square fees for hardware, Square fees for software, and Square credit card fees or processing fees

Depending on what kind of Square POS system you opt for, your Square fees could potentially consist of only Square processing fees. However, if you opt for more powerful hardware or software, Square card reader fees and software fees could apply on top of your Square processing fees.

Besides charging for hardware, software, and payment processing fees, Square charges no other hidden fees. There will be no extra Square credit card fee for processing credit card payments through your POS or other miscellaneous fees.

As a result, even though there’s no automated Square fee calculator for you to consult, there is a way to estimate how much your business would end up paying in Square fees.

So now that you understand the framework of Square’s pricing system, let’s dive into the details of what Square fees your business might face if you opt for a Square POS system:

Square Fees for Hardware

Square Hardware What It Costs Additional Costs
Magstripe Reader
Free
Smart device needed
Chip Reader
$35
Smart device needed
Chip and Contactless Payment Reader
$49
Smart device needed
Stand
$199
iPad needed
Square Terminal
$399
None
Register
$799, or $39/month for 24 months
None

As you can see from the table above, you’ll find a lot of variation for Square fees in the costs that Square charges for its hardware.

Let’s get more context on what these Square hardware fees entail:

Magstripe Reader

When you sign up for Square, you will be gifted a free magstripe reader. This device can plug into the headphone jack or lightning connector of your mobile device and allow you to run magstripe credit card transactions in conjunction with the Square POS mobile app. Additional magstripe readers cost $10 each.

Chip Reader

Square charges $35 for a chip reader that can plug into the headphone jack of your mobile device to allow you to accept chip card payments via EMV technology. This device also works in conjunction with the Square POS app. 

Chip and Contactless Payment Reader

The Square chip and contactless payment reader pairs with a smart device through bluetooth to allow you to accept contactless payment methods such as Google Pay and Apple Pay, as well as chip card payments. Square charges $49 for this reader, and it also works in conjunction with the Square POS app. 

Stand

Your next step up in hardware will be the Square Stand—a piece of hardware that convert iPads into powerful countertop POS systems. Although Square transaction fees will remain the same for any transaction you run through this stand, Square pricing will be a bit steep for the hardware itself—Square charges $199 for their Stand.

That said, the Stand will allow your business to process all payments types and is one of the more affordable countertop POS systems on the market, especially if your business already has access to an iPad. If not, you can purchase your iPad through Square for an additional $329.

Square Terminal

The Square Terminal is a handheld POS terminal that allows you to take all forms of payment and print receipts. While this device is a considerable step up in price, users will get a discounted per transaction fee from Square. This device also comes with 24/7 fraud prevention.

Register

Finally, the most powerful hardware option—with the highest pricing—is the Square Register.

The Register is a fully integrated desktop POS that will process any type of payment and won’t require any smart device to do so. Square charges a cool $799 for it. However, the Register will allow your business to access lower Square transaction fees. And if your business is making a high volume of transactions, then these lower Square rates could save your business some serious cash.

Square Hardware Kits

We should also mention that Square sells a variety of hardware kits to give businesses an all-in-one POS hardware solution. The kits range in price from $555 to $1,396 and include cash drawers, receipt printers, and wireless routers. They are also tailored to your business type—retail, food and beverage, or health and wellness.

Square Fees for Software

Square Software What It Costs Capabilities
Square Point of Sale
Free
Online and offline payment processing, inventory
management, employee management, sales reporting, refunds, taxes, tipping, discounts, and more
Square for Retail
$60/month
Multi-location inventory management, customer relationship management, in-app purchase orders, employee management, employee timecards and more
Square for Restaurants
$60/month
Online and offline payment processing, inventory
management, customer relationship management, employee management, menu management, floor plan management, sales reporting, refunds, taxes, tipping, discounts, and more

POS hardware is just one piece of the POS puzzle. You also need POS software to work with your POS hardware. With Square you have three options when it comes to POS software.

Luckily, there won’t be as many details to sift through with Square fees for software options. That’s because Square offers three options, and the cost you will pay to use any of them is very straightforward. Let’s take a look at all three.

Square Point of Sale Software

For their default software—Square Point of Sale—Square charges no extra cost beyond the Square processing fees that you’ll pay for each card transaction processed through the Square POS system. This is a really great deal considering everything that the Square POS software can do: process all payment types, track inventory, provide employee management functions, and work offline. 

Square for Retail Software

If you’re in the market to upgrade your Square POS software, you should consider opting for the Square for Retail software. This system costs $60 per month to use, but features lower credit card processing rates, plus an array of additional features that retail merchants will find useful, such as the ability to complete purchase orders from your POS, manage customer profiles, set custom employee permissions, and more.

Square for Restaurants

Square’s newest POS software is designed for restauranteurs. Like Square for Retail, this software will cost an additional $60 per month, but also features lower credit card processing fees. There are also a bunch of industry specific features offered with Square for Restaurants, including the ability to manage your menus, floor plan, reconcile tips, arrange for takeout and delivery orders, and more.

Square Processing Fees

Type of Transaction Square Rate
Manual Entry (All Devices)
3.5% + $0.15
Online Payments
2.9% + $0.30
Magstripe Payment (Readers or Stand)
2.75%
Chip Payment (Readers or Stand)
2.75%
Contactless Payment (Readers or Stand)
2.75%
Magstripe, Chip, or Contactless Payment (Terminal)
2.6 + $0.10
Magstripe, Chip, or Contactless Payment (Register)
2.5 + $0.10
Square for Restaurants
2.6 + $0.10
Square for Retail
2.5 + $0.10

The most complicated part of the Square pricing you’ll face if you opt for one of their POS systems will be the Square processing fees attached to your account. Square charges transaction fees across all of their hardware and software options. As you can see in the above chart, there is some variation in these fees. The answer to how much does Square charge per transaction will vary based on how you process the transaction and which piece of hardware and software your POS system runs through.

Though Square rates will vary, one universal Square transaction fee that will apply is the manual entry, keyed-in transaction fee. No matter which hardware you have, you’ll pay 3.5% of the transaction value, plus $0.15 per transaction that you or your employees key in card information for. If you accept online payments via an ecommerce platform, Square will charge a per transaction processing fee of 2.9% + $0.30.

Otherwise, if you’re working with any piece of hardware besides the Register or Terminal, and you run a transaction through magstripe, chip technology, or contactless payment, then the Square transaction fee will be 2.75% of the transaction value. The exception here is if you are using the Square for Retail or Square for Restaurants software.

If you decide to invest in the Terminal, any swiped, inserted, or tapped transaction will cost your business 2.6% of the transaction value, plus $0.10 in Square processing fees. If you use the Register, that price drops to 2.5% + $0.10 per transaction.

The Lowest Square Fees Possible

Perhaps you’re looking to pay the least fees possible beyond the unavoidable Square processing fees. Although the Square transaction fees won’t be negotiable, it is possible to skirt the Square rates for hardware and software. You’ll simply have to make do with the free version of their card reading hardware—the magstripe reader—and the free software—Square Point of Sale.

These two products will be completely free of Square fees beyond Square transaction fees. Plus, they’re remarkably powerful for their low price. If your business isn’t processing a high volume of card transactions and requires little from its POS system, then avoiding these extra Square fees could be totally worth it.

The Lowest Square Rates Possible

On the other hand, if your business is processing a high volume of transaction and, as a result, will require a lot of work from its POS system, then it might be worth investing in the Square Register in order to access lower Square processing rates.

For high-volume business, the lower Square rates that come with the Register—2.5%, plus $0.10—could quickly make up for the $799 that Square charges for the hardware.

Square Fees and Rates for Your Business

Because revenues, transaction volumes, and even business needs will shift regularly, Square fees and rates will also shift with them. As you make more transactions and buy new Square hardware or software, the Square fees you pay will change. Overall, Square fees are designed to accommodate your business as it grows and evolves. 

Editorial Note: Fundera exists to help you make better business decisions. That’s why we make sure our editorial integrity isn’t influenced by our own business. The opinions, analyses, reviews, or recommendations in this article are those of our editorial team alone. They haven’t been reviewed, approved, or otherwise endorsed by any of the companies mentioned above. Learn more about our editorial process and how we make money here.

Maddie Shepherd

Contributing Writer at Fundera
Maddie Shepherd is a former Fundera senior staff writer and current freelance writer. Maddie has an extensive knowledge of business credit cards, accounting tools, and merchant services, but specializes in small business financing advice. Maddie has a bachelor's degree in Spanish and Latin American cultures from Barnard College.

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