Card Machines for Cafes, Pubs and Restaurants: Fees, Tips and Table Payments

LAST REVIEWED 2026-09-06

What hospitality needs from a terminal

Cafes, pubs and restaurants have distinct requirements from card machines. Unlike retail, hospitality venues often process payments away from a fixed till, at tables, bars or outdoor seating. A terminal must therefore be portable, durable and quick to use. Battery life is critical for a full service, and connectivity options such as Wi-Fi or 4G ensure reliability in areas with poor signal.

Beyond hardware, hospitality businesses need software features that integrate with their existing EPOS systems. This includes menu management, split billing and the ability to apply service charges. Staff should be able to process a payment in seconds, especially during peak hours. The user interface must be intuitive, reducing training time and errors.

Security is another priority. Terminals must be PCI-DSS compliant and support contactless, Apple Pay and Google Pay. For larger transactions, chip and PIN remains essential. Some providers offer pre-authorisation for tabs, which is useful in pubs and bars. The choice of provider should also consider customer support, as downtime directly impacts revenue.

Finally, cost structures vary. Providers may charge a fixed monthly fee, a per-transaction fee, or a combination. Hospitality businesses with lower average transaction values but high volumes need a pricing model that does not penalise small payments. Understanding these needs is the first step in selecting a suitable card machine.

Portable and pay at table

Portable terminals are a staple in hospitality. They allow staff to bring the card machine to the customer, whether at a table, a bar stool or an outdoor terrace. This reduces queues at the till and improves the customer experience. Pay-at-table technology goes further, enabling customers to pay without waiting for a server to process the payment. Some systems allow customers to split the bill, add a tip and request a receipt via email or SMS.

The benefits are measurable: faster table turnover, increased average spend and reduced staff workload. According to industry studies, pay-at-table can increase tips by up to 30%, though specific figures are not published. For pubs, portable terminals are useful for table service and for outdoor areas where fixed tills are impractical.

However, portable terminals come with considerations. They are more expensive than countertop models, and battery life may be a limitation. Some providers offer ruggedised devices designed for the hospitality environment, resistant to spills and drops. Connectivity is another factor: 4G terminals work anywhere but may incur additional SIM costs.

When choosing a portable terminal, businesses should assess the coverage area, the number of devices needed and the expected transaction volume. Rental terms are also important. The Payment Systems Regulator (PSR) has capped initial terminal lease terms at 18 months since July 2023, giving businesses more flexibility to switch providers.

Tipping and service charge

Tipping is a key feature for hospitality card machines. Customers increasingly expect to add a tip when paying by card, whether at a counter or at the table. Card machines can be configured to prompt for a tip before completing the transaction, with options such as 10%, 12.5% or a custom amount. For service charges, the machine can apply a fixed percentage to the bill, which is common in restaurants for large groups.

The handling of tips is subject to legal and tax rules. Tips paid by card are processed through the merchant account and then distributed to staff. The employer must ensure that tips are paid to staff without unlawful deductions, as per the Employment (Allocation of Tips) Act 2023, which came into effect in 2024. This requires a fair and transparent tipping policy.

From a technical perspective, the card machine provider must support tip functionality. Some providers offer integrated tipping that automatically calculates the tip and records it separately for payroll purposes. This reduces administrative burden and ensures accuracy.

It is important to note that tips are subject to the same interchange fees as the main transaction. For example, if a customer pays a £50 bill and adds a £5 tip, the total transaction of £55 is processed at the applicable rate. This means that tips increase the overall card processing cost, though the percentage remains the same.

Amex and credit-heavy mix

Hospitality venues often see a higher proportion of credit card and American Express (Amex) payments compared to other sectors. This is because business meals and expense accounts are frequently paid with corporate cards. Amex typically charges merchants higher interchange fees than Visa or Mastercard, often around 1.5% to 3.5%, though exact rates are not published. In contrast, consumer debit cards are capped at 0.2% and consumer credit cards at 0.3% under the Interchange Fee Regulation (IFR).

For a hospitality business, a credit-heavy mix can significantly increase card processing costs. For example, if a restaurant processes £10,000 in card payments, and 20% are Amex with an average fee of 2.5%, the cost for those transactions alone would be £50, compared to £6 if they were debit cards at 0.3%. This difference can be substantial over a year.

Some providers offer blended rates that average out the cost across all card types, while others apply different rates for different cards. Businesses should understand their customer payment mix and choose a pricing structure that reflects it. They may also consider surcharging for Amex, though this is subject to rules and may deter customers.

It is also worth noting that the IFR caps apply to consumer cards within the European Economic Area, but Amex is not always subject to the same caps. Therefore, Amex fees are often higher. Hospitality businesses should factor this into their cost projections.

Worked example at typical turnover

To illustrate the cost impact, consider a typical cafe with an annual turnover of £100,000, of which 80% is paid by card. That equates to £80,000 in card payments. If the average card fee is 0.3% for debit and 0.3% for credit (the IFR caps), the annual fee would be £240. However, if the mix includes 10% Amex at an average fee of 2.5%, the calculation changes.

Assume £72,000 is paid by Visa or Mastercard (90% of card payments) and £8,000 by Amex (10%). The Visa/Mastercard portion at 0.3% costs £216. The Amex portion at 2.5% costs £200. The total annual card processing fee would be £416, which is 0.52% of card turnover. This is significantly higher than the 0.3% baseline.

For a pub with a higher average transaction value, the effect is similar. If the pub processes £200,000 in card payments with the same mix, the total fee would be £832. These figures illustrate why hospitality businesses must consider their card mix when evaluating provider fees.

It is important to note that these are simplified examples. Actual fees may include fixed monthly charges, terminal rental, and other costs. Providers may offer lower per-transaction rates in exchange for higher monthly fees. Businesses should obtain quotes and compare total cost of ownership.

The table below summarises the impact of different card types on fees.

Provider fit

Choosing a card machine provider for a hospitality business requires careful evaluation. Providers vary in their pricing models, contract terms, and the features they offer. Some specialise in hospitality, offering integrated tipping, pay-at-table and EPOS compatibility. Others are generalist but may still provide suitable solutions.

Key factors to compare include: transaction fees (blended or interchange-plus), monthly fees, terminal costs (purchase or rental), and contract length. The PSR's 18-month cap on initial terminal lease terms gives businesses more freedom to switch, but early termination fees may still apply if the contract is longer.

Businesses should also consider the quality of customer support. In a busy restaurant, a terminal failure can be disastrous. Providers that offer 24/7 support and replacement devices are preferable. Some providers offer a 'plug and play' solution that works with existing EPOS systems, reducing integration costs.

Another consideration is the settlement time. Some providers offer next-day settlement, while others may take longer. For cash flow, faster settlement is beneficial. However, faster settlement may come at a higher cost.

It is advisable to obtain quotes from multiple providers and ask for a detailed breakdown of fees. A provider that appears cheap on transaction fees may charge high monthly fees or require a long contract. The total cost of ownership over a year should be the deciding factor.

Finally, check the provider's reputation and reviews from other hospitality businesses. A provider that understands the unique needs of cafes, pubs and restaurants will be better equipped to offer a suitable solution.

Frequently asked questions

Best card machine for a cafe?

For a cafe, the best card machine is typically a portable countertop terminal that supports contactless and mobile payments. It should be quick to use for high volumes of small transactions. Look for a provider with low per-transaction fees, as cafe average transaction values are often low. Some providers offer 'pay as you go' plans with no monthly fee, which can be cost-effective for small businesses. Ensure the terminal has a long battery life and reliable connectivity. Also consider whether the provider integrates with your EPOS system for inventory and reporting. Compare quotes from several providers to find the best fit for your specific needs.

How do tips work on card machines?

Tips on card machines are processed as part of the card transaction. When a customer pays, the machine may prompt them to add a tip, either as a percentage or a custom amount. The total amount (bill plus tip) is then charged to the customer's card. The tip is included in the transaction and later settled to your business bank account, along with the bill amount. You are then responsible for distributing the tips to your staff. Under the Employment (Allocation of Tips) Act 2023, you must have a fair and transparent policy for allocating tips. Some card machine providers offer integrated tipping that automatically records tips separately for payroll purposes.

Do restaurants pay more in card fees?

Restaurants may pay more in card fees than other businesses due to a higher proportion of credit card and Amex payments. Credit cards have a higher interchange cap (0.3%) than debit cards (0.2%), and Amex fees are often significantly higher, sometimes exceeding 2%. Additionally, restaurants often have higher average transaction values, which can increase the total fee amount. However, the actual fee depends on the provider's pricing structure and the card mix. Restaurants can mitigate costs by choosing a provider with competitive rates and by understanding their customer payment preferences.

Pay at table or at counter?

Pay-at-table and counter payments each have advantages. Pay-at-table allows customers to pay without queuing, which can increase table turnover and improve customer satisfaction. It also encourages tipping, as customers can add a tip on the terminal. However, pay-at-table terminals are more expensive and require staff to bring the device to the table. Counter payments are simpler and cheaper, but may lead to queues during peak times. For cafes with quick service, counter payments are often sufficient. For restaurants and pubs with table service, pay-at-table can enhance the experience. Consider your venue's layout and service style when deciding.

Is a mobile reader enough for a pub?

A mobile reader can be sufficient for a pub, especially if you have a small venue or offer table service. Mobile readers are portable, accept contactless and mobile payments, and are often cheaper than traditional terminals. However, they may have limitations such as shorter battery life and less robust build quality. For a busy pub with high transaction volumes, a dedicated portable terminal with a longer battery life and faster processing may be more suitable. Additionally, consider whether you need features like pre-authorisation for tabs or integration with your EPOS. Assess your expected transaction volume and customer flow to decide if a mobile reader meets your needs.