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Updated Jan 19, 2024

iPhone Credit Card Processing: What You Need to Know

Need credit card processing support? Here's how to use your iPhone as a credit card processor.

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Adam Uzialko, Business Strategy Insider and Senior Editor
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

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Entrepreneurs and small business owners often need an efficient way to accept mobile credit and debit card payments. Using your iPhone as a mobile POS system — where your phone transmits data instead of a traditional terminal — is an excellent way to start accepting card payments securely and easily. 

We’ll showcase the best credit card processors to consider with an iPhone POS system and how iPhone-based credit card processing works. 

Did You Know?Did you know
Consumers overwhelmingly prefer spending with credit instead of cash, so not accepting credit cards could hurt your business.

Best credit card processors for iPhone

Many credit card processors work well with iPhones. The processor you work with should be able to handle your business volume efficiently and affordably. Here’s a look at our top picks for iPhone credit card processors and the credit card processing costs and fees you can expect. 

Company

Reader fee

Transaction fee

Monthly fee

Square

$0-$49

2.6% + $0.10

$0

Payment Depot

Card terminals included

Varies by volume

$59-$99 

Clover

$49

2.6% + $0.10

$0-$14.95

PayPal

$29

2.29% + $0.09

$0

Square

Square is our choice for the best credit card processor for small businesses. It has a flat-rate pricing model, no monthly fees and free POS software. Square is suitable for any business type and allows you to accept in-person, mobile and online payments. Its Square Reader is a mobile credit card swiper that plugs into your iPhone; all you need to do is open the Square POS app and swipe the card for payment. (You can also set up contactless payments.)

Some benefits of Square include the following: 

  • Square sets up its customers as sub-merchants under its merchant account, so startup is fast and easy. 
  • Square doesn’t lock you into a long-term contract. 
  • You can receive funds quickly. 
  • Getting started and setting up your system and processing are straightforward. 
  • The free Square Point of Sale app includes impressive POS features and tools.

Some of the downsides of using Square are as follows:

  • Customer service isn’t available 24/7.
  • Square will put a hold on transaction funds if it spots any red flags. 

For more information, check out our in-depth Square review

Payment Depot

Payment Depot is our top pick for a low-fee credit card processor. It charges a flat monthly fee instead of a percentage of sales, giving small businesses a lower-cost option. Clients can pay via mobile credit card readers or email.

Payment Depot’s pros include the following: 

  • Businesses pay a flat rate each month and a low transaction fee.
  • Payment Depot gives you a merchant account so you can accept payments in-store and with mobile devices.
  • The service offers integrations with QuickBooks, Shopify and WooCommerce.
  • Payment Depot will assign you a dedicated account rep.

These are some of the cons of using Payment Depot: 

  • Online customer support options are scarce. 
  • If you have a low-volume business or are a high-risk merchant, the service isn’t for you.
TipTip
Ensure your POS system provides in-depth POS reports to help you make staffing and purchasing decisions, improve your marketing strategy, and inform your business growth plan.

Clover

Clover is our choice for the best credit card processor for new businesses. It’s a cost-effective option if you’re just getting started with POS payment acceptance, offering flat-rate pricing, month-to-month contracts, and affordable POS software and hardware.

Some benefits of Clover include the following: 

  • Its POS software and hardware are robust and feature-full. 
  • Multiple pricing plans offer choices and flexibility. 
  • It offers e-commerce functionality, including website-building and inventory-management tools. 
  • Clover provides a merchant account.
  • Clover’s customer engagement tools help you create customer profiles and customer loyalty programs.

Some of Clover’s downsides are listed below: 

  • Clover charges a monthly platform fee and application fee.
  • If you’re a high-volume business, you may end up paying more. 
  • If you cancel, you may be charged a termination fee.

For more information, check out our complete review of Clover

PayPal

PayPal’s mobile credit card processing solution is called PayPal Zettle, which offers a full suite of POS hardware, free POS software and reasonable fees. (PayPal Here was PayPal’s previous solution. It’s no longer available for new merchants, but existing merchants can still use its services, software and hardware.)

The pros of PayPal Zettle include the following: 

  • PayPal Zettle offers a transparent fee structure. 
  • The card reader’s screen makes transactions easy to understand. 
  • You can process payments from all major credit and debit cards, PayPal and Venmo accounts, and other mobile payment apps.

Here are some downsides of using PayPal Zettle: 

  • The system doesn’t accept swipe payments, only chip and contactless payments. 
  • PayPal will withhold funds or freeze accounts swiftly if it suspects fraud. 
  • Funds are deposited into a PayPal account, not a bank account. 
Did You Know?Did you know
In addition to payment processing, PayPal offers an invoicing tool, business loans, flexible lines of credit and more.

Types of credit card processors for iPhone and how they work

To help you better understand your iPhone credit card processing options, here’s an overview of the two primary types of credit card processors for iPhone and how they work.

1. App and reader

The app-and-reader combo is the most popular mobile credit card processing solution for iPhones. It’s also one of the easiest to use. Businesses sign up for a merchant account with the provider of their choice and then download the provider’s app to their iPhone.

Most app-and-reader companies send their merchants a free or affordable credit card reader that plugs directly into the iPhone. With the reader in place, you can start accepting payments everywhere you bring your iPhone from customers using magstripe cards, EMV chip cards, contactless cards or mobile wallets.

If you go with an app and reader for mobile credit card processing, providers will likely charge you a nominal flat fee per transaction and a percentage of the sale.

TipTip
You can often negotiate lower credit card processing fees with your provider as your needs and circumstances change.

2. App and terminal

If you’re looking for a more robust mobile credit card processing solution, the app-and-terminal option may be what you need. While it still relies on an app, this setup looks like a more traditional POS system.

Mobile credit card terminals can be used anywhere you have your iPhone. They come with additional POS features to help you streamline your business, maximize profits, and better leverage your existing customer base, such as the following: 

For businesses with a fixed location, multiple staff members or consistent inventory, the app and terminal setup is an easy-to-use option that offers additional functionality and reliability. 

The terminals often come with a complete set of equipment, including the following items: 

  • Barcode scanner
  • Cash register
  • Receipt printer
  • Contactless or NFC mobile payments reader (which allows you to accept contactless cards or services like Apple Pay and Google Pay, reducing your liability for fraudulent charges) 

Many companies, like Square, offer a basic app-and-reader setup with an upgrade path to an app-and-terminal solution. This flexibility allows your credit card payment solution to grow with your business. Some app-and-terminal solutions come with a monthly fee, so you’ll need to determine whether the added functionality is worth the price. 

Did You Know?Did you know
Using your PayPal account or Venmo for Business to accept credit card payments may be your simplest option, requiring no hardware and minimal fees. You can also ask customers to pay you via Zelle, Apple Pay or Google Pay.

Finding the right iPhone credit card processing solution

You have several excellent options when using your iPhone for credit card processing. The one that’s right for you will depend on your business, its products and services, and your customers’ needs. Making an informed choice can help you maximize your budget and optimize customer experience.

Linda Pophal contributed to the reporting and writing in this article. 

author image
Adam Uzialko, Business Strategy Insider and Senior Editor
Adam Uzialko, senior editor of Business News Daily, is not just a professional writer and editor — he’s also an entrepreneur who knows firsthand what it’s like building a business from scratch. His experience as co-founder and managing editor of a digital marketing company imbues his work at Business News Daily with a perspective grounded in the realities of running a small business. Since 2015, Adam has reviewed hundreds of small business products and services, including contact center solutions, email marketing software and text message marketing software. Adam uses the products, interviews users and talks directly to the companies that make the products and services he covers. He specializes in digital marketing topics, with a focus on content marketing, editorial strategy and managing a team.
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