The short answer
To accept card payments, a UK business needs an agreement with a payment provider (merchant services) and a way to take payments — a card machine in person, online checkout or payment links, or a virtual terminal for phone orders. Compare the total cost at your own volumes, settlement times and contract terms, follow the PCI DSS security standard, and read the provider's agreement before signing.
What you need to accept card payments
You need a payment provider to process transactions and pay the money into your bank account, plus a payment method that matches how your customers pay.
- A payment provider agreement. The provider runs its own application, identity and business checks before approving you.
- A bank account for settlement. Many providers require a business bank account — check their requirements.
- One or more ways to take payments: a card machine, online checkout, payment links or a virtual terminal.
- For in-person payments, a reliable connection (broadband, Wi-Fi or mobile data) for your card machine.
Choosing how to take payments
Match the method to where your customers pay: in person, online, by invoice or over the phone.
| Method | Best for | Watch out for |
|---|---|---|
| Countertop card machine | A fixed till in a shop | Needs a stable broadband connection |
| Portable card machine | Table service in cafés and restaurants | Wi-Fi or Bluetooth range across the premises |
| Mobile card machine | Deliveries, markets and events | Mobile data coverage and SIM charges |
| Online checkout | Selling through a website | Integration with your site and fraud checks |
| Payment links | Deposits, invoices and remote orders | Per-transaction fees and how links are sent |
| Virtual terminal | Taking card details by phone | Card-not-present fees and security rules |
Some providers also offer apps that accept contactless payments on a compatible smartphone, which can suit very low volumes or businesses that are just starting out.
How card payment fees work
Card costs usually combine a charge on every transaction with fixed monthly costs, so compare the total you would pay at your own volumes rather than one headline rate.
- Transaction charges — a percentage of each payment, a fixed amount per transaction, or both.
- Interchange fees, paid to the cardholder's bank, are capped for domestic UK consumer cards at 0.2% of the transaction value for debit cards and 0.3% for credit cards. Business and commercial cards, and cards issued outside the UK, are not covered by those caps and usually cost more.
- Card scheme fees and the provider's own margin are added on top, which is why total pricing differs between providers.
- Monthly charges can include terminal rental, an account or service fee, and a PCI compliance fee.
- Other charges can include setup fees, chargeback fees and minimum monthly charges.
Pricing models differ. A blended rate charges one rate for most cards; an itemised (often called interchange-plus) model passes interchange and scheme fees through separately. Ask each provider to price the same monthly figures so you can compare like for like.
Contracts and terminal agreements to check
Read both the processing agreement and any terminal agreement — they can be separate contracts with different terms.
- Contract length, automatic renewal and the notice you must give to leave.
- Early termination charges for the processing agreement.
- Terminal rental or lease terms. Some lease agreements run for several years and may not be cancellable early — check before you sign.
- Minimum monthly charges if your card turnover is lower than expected.
- Settlement timing — when funds reach your bank account.
Security and compliance (PCI DSS)
Any business that accepts card payments must protect card data under the Payment Card Industry Data Security Standard (PCI DSS); your provider will explain what you need to do, which for many small businesses is a self-assessment.
- Never write down or email full card numbers.
- Use your provider's secure tools for phone and online payments.
- Keep card machines and software updated, and restrict who can access them.
How to compare payment providers: step by step
- Gather your figures: monthly card turnover, average transaction value and the mix of debit, credit and business cards. A recent processing statement helps.
- Decide which payment methods you need: in person, online, payment links or phone.
- Ask for quotations based on the same figures.
- Compare the total monthly cost, including fixed charges, not just the transaction rate.
- Check settlement times, customer support and terminal options.
- Read the processing and terminal agreements, including renewal and exit terms.
- Plan your switch around your current contract's notice period.
How Meridian can help
Meridian Merchant & Energy Solutions Ltd helps UK businesses explore card machines, POS systems and merchant services from the third-party providers we work with, explains the options and costs in plain English, and tells you who you would be contracting with before you decide.
Meridian acts as an introducer, broker or reseller depending on the service. The provider supplies the service under its own terms and carries out its own eligibility checks. We may receive commission from providers — you can ask us about it at any time, and it is disclosed where the rules require. Submitting an enquiry is free and does not commit you to anything.
Related solutions
Frequently asked questions
Can I accept card payments without a card machine?
Yes. You can use online checkout, payment links or a virtual terminal for phone payments, and some providers offer apps that accept contactless payments on a compatible smartphone.
How long does it take to start accepting card payments?
It depends on the provider's checks and, for card machines, delivery of the terminal. Ask the provider for its expected timescale before you apply.
What is the difference between a payment provider and a broker?
A payment provider processes your transactions and is responsible for the service under its agreement with you. A broker or intermediary, such as Meridian, helps you compare providers but does not process payments itself.
Sources and further reading
- HM Treasury — UK Interchange Fee Regulation (caps of 0.2% debit / 0.3% credit)
- Payment Systems Regulator — card payment regulation
- PCI Security Standards Council — PCI DSS
This guide is general information for UK businesses, not financial, legal or tax advice. Rules and prices change — check the sources above and your provider’s terms before making decisions.