Square is 2.75% with no fixed fee. This is by far the best rate you can get for low amount charges and why Square enabled an entire new category of credit card merchants like fast food.

That's not that low for card present. Except for very low volume sellers. What fast food companies are using square? I've only seen square used in small shops.

For $5-10 purchases you'd cut your CC fees in half. That's a lot. Pretty much every food truck and many non-national fast food restaurants and cafes use it.

From the landing page: "In-person payment processing: 2.7% + 5¢"

(may be getting A/B tested if you're seeing something different?)

actually, their pricing is 2.5% +10c for custom in person payments (Reader SDK) https://squareup.com/us/en/developers/reader-sdk

Ahh, that's helpful. I went to the main pricing page. It is on the landing page, as you say...but really far down the fold.

For low value, high volume merchants, Square's rate is extremely competitive.

I don't see how that's possible. Low value would skew it even more versus 2.9% + 30 cents, because you'll have more debit cards for low value transactions. Debit card transactions (pin or not) are cheaper post Durbin amendment.

Open to stats that say otherwise.

> I don't see how that's possible. Low value would skew it even more versus 2.9% + 30 cents

Because that’s not Square’s rate, they charge a flat 2.75%.

And a regulated debit card is around a 10 cents flat fee. No percentage.

Square's fees are pretty high unless you are processing less than say $150k a year.

Could you clarify? Is this markup only on card present transactions?

Card-present transactions are typically cheaper, because the risk of fraud is better mitigated. With chip cards, the fraud risk for card-present is almost entirely in physically stolen cards. (Sophisticated shops could duplicate magnetic stripes. That's a lot harder to do with chips.)

Compared to online, where all you have is the card number and the CVV, both of which are easily duplicated. And this is why tokenization is such a big deal. Tokenization means you don't store the actual card number, and the token you do store is tied directly to your merchant, so it's not widely reusable.

It's specific to the US. Within the US, if have your own merchant account, "card present" is a lot cheaper than "card not present".

So far, companies like Paypal, Square, and now Stripe, don't pass those savings on. They all have one rate that doesn't differentiate.

More importantly, fraud rates are much lower with CP than CNP. If the Visa/MC in the US goes with a PIN-type system like the rest of the world, fraud rates drop to near zero, which makes Card Present insanely profitable for them.

card present fees are vastly different (lower) than not present, and there is usually no fixed fee.