What to Consider When Choosing a Credit Card Reader

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Update time : 2022-09-29

By definition, credit card readers are devices that process payments by reading the data from a card, encrypting it, and sending it to the payment network, which either approves or rejects the transaction. This whole process happens in seconds. As a result, your customers enjoy using their payment method of choice, all while you quickly and effectively collect secure payments.

There are many factors to consider when selecting the right credit card reader for your business. Below explains what you need to take into account when making this decision for your business.

Your preferred method to accept payments

Credit card readers on the market today offer a wide variety of payment processing options. From payments made by traditional magnetic stripe technology to contactless payments, there are a number of ways to accept credit card payments. So, you need to consider which ones are a priority for your business.

If you’d like to stick with the basics, you can choose a card reader offering a narrower selection of credit and debit card optionssuch as one with technology that only reads magnetic stripes or EMV chips.

Moreover, you also want to consider how you want to accept payments. For example, are you setting up independent checkout locations throughout your store? Is your business primarily mobile where you might need mobile card swipers? These are all important questions to ask as you sort through your options.

Your payment processor’s product offering

While narrowing down your card reader options, keep in mind which type your current payment processor provides. Your processor has reseller agreements with specific brands and may or may not carry the exact brand you want.

Consequently, you may want to choose a card reader that works with your existing setup. If you plan to keep working with your existing payment processor, your options will be narrowed down by which card readers are available. Alternatively, you could opt for switching to an all-in-one (omni-channel) integrated system offering additional features that can be especially useful as you scale up.

Type and length of contract

Credit card processors require you to sign a contract (also known as a merchant agreement) before processing payments using their hardware. It’s important to keep this in mind and decide what sort of contract you’d like to sign. Additionally, be on the lookout for credit card processing fees detailed in the contract so that you can remain within your business’s budget.

EMV and NFC support

It’s important to look for a credit card reader that offers your customers their preferred payment method. This could mean offering EMV or near-field communication (NFC) functionalities, the latter of which enables contactless payments.


As a savvy business owner, you’re looking for a credit card reader option that suits your needs and your budget. To ensure you’re getting the most bang for your buck, it’s important to understand the different credit card processing fees you may see when looking at options.

Below, we break down processing fees and hardware fees in more detail, as they determine the cost of your credit card reader.

Processing Fees

Credit card processing comes with its own fees. This is because each time your customers tap, swipe, or dip their cards, many parties are involved in processing the transaction, which costs money.

On average, you can typically expect to pay a processing fee of 1.5 percent to 3.5 percent per transaction. The fees you’re charged may vary based on the type of card used, card network, whether it’s a card-present or card-not-present transaction, and even your assigned merchant category code.

Hardware Costs

hand holding wireless credit card machine and credit card for contactless payment

The physical hardware or equipment you need to process credit cards can come with its own costs. Basic hardware includes a display screen, a keypad, and a magnetic strip to read card data. If you’re looking for additional features, like a built-in receipt printer or touchscreen, the costs of the accessories will likely increase the price of the hardware.

On average, mobile card readers cost about $40 to $60. Handheld terminals are typically between $300 to $400, and countertop terminals are usually priced anywhere between $700 to $900. Most lower echelon readers are offered free of charge with a merchant account.

Renting vs. buying terminals

You can buy your terminal from your merchant services provider, which is a preferred option among many businesses. Alternatively, you can lease or rent your terminal. The benefit of leasing or renting is that it spares you from having to pay upfront, saving you money in the short term. Though, this may cost you more money in the long term.

Renting terminals is not as common as it used to be, unless it is for an expensive POS system.

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