Square Card Reader Fees UK: Rates, Hardware and Payout Times

LAST REVIEWED 2026-09-06

Fees

Square's UK pricing is straightforward: a single flat rate of 1.75% applies to all card payments, whether debit, credit, or contactless. There are no hidden charges, no monthly fees, and no setup costs. This rate is competitive for small businesses and startups that process lower volumes, as it avoids the tiered pricing structures common with traditional merchant accounts.

For businesses with higher turnover, Square does not publish volume discounts on its standard pricing page, but it may offer bespoke rates for larger enterprises. It is important to note that the 1.75% rate applies to transactions made in person using Square hardware. For online payments, the rate is different, but this article focuses on card reader fees.

There are no additional fees for chargebacks, refunds, or PCI compliance, which can be a significant saving compared to other providers. However, if a transaction is refunded, the original processing fee is not returned. Square also charges a fee for instant transfers, which is detailed in the payout section.

All fees are inclusive of VAT, and there are no minimum monthly processing requirements. This makes Square particularly attractive for seasonal businesses or those with fluctuating sales volumes.

Hardware

Square offers a range of card readers designed for different business needs. The most basic option, the Square Reader, costs £19 (one-off) and connects to a smartphone or tablet via Bluetooth. It accepts chip and PIN, contactless, and mobile payments. For businesses that need a more robust solution, Square also offers the Square Terminal, which is a standalone device with a built-in printer and screen, priced at £149 (one-off).

All hardware comes with a standard warranty, and Square does not require a long-term lease or rental agreement. This is a key advantage, as the Payment Systems Regulator (PSR) has capped initial terms for POS terminal contracts at 18 months, but Square's outright purchase model avoids this entirely.

There are no ongoing costs for the hardware, and businesses can buy additional readers as they grow. The Square Reader is known for its quick setup and ease of use, with no complex installation required. It is also worth noting that Square does not charge for the software that accompanies the hardware, including the point-of-sale app and dashboard.

For businesses that prefer not to buy hardware upfront, Square occasionally offers promotions or bundles, but standard pricing is as stated. Hardware costs are not published for all devices, but the two main options are clearly priced on the Square website.

Payout

Square processes payouts on a next-business-day basis as standard. This means that transactions made on a Monday are typically deposited into the linked bank account by Tuesday. There is no minimum payout threshold, and funds are transferred automatically.

For businesses that need faster access to their money, Square offers an instant transfer feature. This allows funds to be moved to a eligible debit card in minutes, for a fee of 1% of the transfer amount (with a minimum fee of £0.25). This is optional and can be enabled in the Square dashboard.

Payout times can be affected by bank holidays and weekends, but Square does not hold funds for extended periods. There are no hidden delays, and the settlement process is transparent. It is important to note that payouts are subject to Square's risk assessment, and in some cases, funds may be held if there are disputes or suspicious activity.

Compared to other providers that may offer same-day settlement for an additional fee, Square's standard next-day payout is competitive. The instant transfer fee is clearly published, and there are no monthly charges for the service. Overall, Square provides a reliable and predictable payout schedule for UK businesses.

Contract terms

Square operates on a no-contract basis, meaning there is no minimum term or cancellation fee. Businesses can use Square for as long as they wish and can stop at any time without penalty. This is a significant advantage over traditional merchant accounts, which often require 12- or 24-month commitments.

The Payment Systems Regulator (PSR) has introduced specific directions to protect businesses from unfair contract terms in the card terminal market. For example, the PSR's Specific Direction 14, 15, and 16, which came into force in July 2023, require providers to offer summary boxes and trigger messages, and they cap initial terms for POS terminal lease or rental contracts at 18 months. Square's model, which involves outright purchase of hardware and no ongoing contract, aligns with these regulatory intentions.

There are no hidden fees for early termination, and businesses are not locked into a specific processing volume. Square's terms are transparent, and the pricing page clearly states that there is no monthly fee and no contract. This makes it easy for businesses to switch providers if they find a better deal elsewhere.

It is always advisable to read the full terms and conditions, but Square's core offering is designed to be flexible and low-risk for small businesses.

Regulatory status

Square is authorised by the Financial Conduct Authority (FCA) as an e-money institution. This means it is regulated for the issuance of electronic money and the provision of payment services. The FCA registration can be verified on the Financial Services Register, and Square's firm reference number is 825176.

Being FCA-regulated provides a level of consumer protection, and Square must adhere to strict safeguarding requirements for customer funds. However, it is important to note that Square is not a bank, and its services are not covered by the Financial Services Compensation Scheme (FSCS).

In addition to FCA regulation, Square must comply with the Interchange Fee Regulation (IFR), which caps interchange fees for consumer debit and credit card transactions at 0.2% and 0.3% respectively. These caps apply to the fees that card issuers charge acquirers, and they help keep overall processing costs down for merchants.

Square's pricing is transparent and complies with UK regulations. The company also adheres to the PSR's specific directions on contract transparency, as mentioned earlier. Businesses can have confidence that Square operates within the regulatory framework designed to protect them.

Who it suits

Square is particularly well-suited to small businesses, sole traders, and startups that need a simple, low-cost card payment solution. Its flat-rate pricing makes it easy to predict costs, and the lack of monthly fees is ideal for businesses with low or variable transaction volumes.

It is also a good fit for mobile businesses, such as market traders, food trucks, and home-based service providers, thanks to the portable card reader. The quick setup and user-friendly app mean that even those with no technical expertise can start accepting payments within minutes.

However, Square may not be the best choice for large enterprises with high transaction volumes, as they might benefit from bespoke interchange-plus pricing offered by traditional acquirers. Additionally, businesses that require a dedicated merchant account with a direct acquiring bank might find Square's model less suitable.

Overall, Square is an excellent entry-level option for businesses that want to avoid long-term contracts and complex fee structures. Its transparent pricing and fast payouts make it a popular choice in the UK market.

Frequently asked questions

What is the Square fee in the UK?

Square charges a flat rate of 1.75% for all in-person card payments in the UK. This rate applies to debit and credit cards, including contactless and mobile payments. There are no monthly fees, setup costs, or hidden charges. For online payments, the rate is different, but for card reader transactions, the fee is a simple 1.75% per transaction.

Is there a monthly fee?

No, Square does not charge a monthly fee for its standard card processing service. There are no subscription costs or minimum usage requirements. Businesses only pay the flat transaction fee of 1.75% per card payment. This makes Square an attractive option for small businesses and startups that want to keep fixed costs low.

How fast is payout?

Square typically transfers funds to your linked bank account on the next business day after a transaction. For example, sales made on Monday are usually paid out by Tuesday. There is no minimum payout threshold. If you need faster access, Square offers an instant transfer feature that moves funds to an eligible debit card in minutes for a fee of 1% (minimum £0.25).

Is Square FCA regulated?

Yes, Square is authorised by the Financial Conduct Authority (FCA) as an e-money institution. Its firm reference number is 825176, and you can verify this on the Financial Services Register. This regulation means Square must follow strict rules on safeguarding customer funds and providing transparent services. However, Square is not a bank, so its services are not covered by the Financial Services Compensation Scheme.

Does Square offer instant transfer?

Yes, Square offers an instant transfer feature that allows you to move funds from your Square balance to an eligible debit card in real time. This service is available 24/7, and the fee is 1% of the transfer amount, with a minimum fee of £0.25. Instant transfers are optional, and you can enable them in your Square dashboard. Standard payouts remain next business day at no extra cost.