Exploring Modern Retail Payment Solutions
Taking card payments can feel like a complicated, expensive world reserved for big companies. It is not. For UK small businesses, modern payment solutions have made it simpler and more affordable than ever to let customers pay the way they want. This guide demystifies the options, so you can see the main ways to accept payments, in person, online or over the phone, and get back to running your business.
How can a small business accept card payments?
There are three main ways: a card reader for in-person sales, a payment gateway for your website, and a virtual terminal for payments taken over the phone. Most businesses use one or two of these.
| Method | How you take it | Best for |
|---|---|---|
| Card reader (in person) | Customer taps, inserts, or uses a phone wallet | Shops, stalls, face-to-face sales |
| Online gateway | Customer pays on your website at checkout | Selling online |
| Virtual terminal (MOTO) | You key in details from a phone or mail order | Bookings and remote orders |
In person: the card reader
For face-to-face sales you no longer need a clunky, expensive till. A simple handheld card reader, sometimes called a PDQ machine, lets any business start taking cards straight away.
A card reader is a small, portable device that connects wirelessly to an app on your phone or tablet, or works on its own. When it is time to pay, the customer taps a contactless card, uses Apple Pay or Google Pay, or inserts their card and enters a PIN. These devices are designed to be straightforward and affordable, which is what makes them the natural starting point for most small businesses.
Online: payment gateways
If you sell through a website, you need a secure online payment system at your checkout, known as a payment gateway.
It handles the customer entering their own card details on your site and processes the payment securely. Many businesses run both a card reader for in-person sales and a gateway for their website, so they can sell wherever the customer is.
Over the phone: virtual terminals and MOTO
To take payment over the phone you use a virtual terminal, which needs no extra hardware, just a device with an internet connection.
You key in the card details the customer gives you, and the payment goes through securely. These are known as MOTO (Mail Order / Telephone Order) payments, and they are ideal for any business taking bookings or orders remotely. Our full guide to MOTO payments and how they work covers the detail.
How much does it cost to accept card payments?
Costs usually fall into three categories: a one-off hardware cost, a percentage transaction fee, and ongoing charges like rental and PCI.
The transaction fee is the one to understand. As a worked example, if you sell a handmade scarf for £30 and your rate is 1.69%, the fee is just 51p. Knowing that figure helps you price with confidence. Flat all-in-one rates with no monthly fee suit very new businesses, while tiered pricing, where debit starts from around 0.35% and consumer credit from around 0.65%, usually works out cheaper as your volume grows. Our guide to card machine fees breaks it all down, and the cash vs card guide weighs up the wider picture.
Is taking card payments safe?
Yes. The entire payment industry is protected by a mandatory set of rules called PCI DSS, the global benchmark for payment security.
Think of PCI DSS like the food hygiene rating in a cafe window: a clear sign that strict procedures are being followed to keep data locked down. The good news is that modern providers are built to do most of the heavy lifting for you. The small monthly PCI charge on your statement covers maintaining that standard, and our guide explains what a PCI compliance fee is and why it appears.
How to choose the right setup
Start with how you sell. In person, online, by phone, or a mix, then pick the methods that match and compare the cost.
Most independents begin with a card reader and add online or phone options as they grow. The hardware is rarely the hard part, the deal behind it is, so it is always worth checking what you would actually pay. Our guide to the best card machine for small businesses compares the options.
Accepting card payments: FAQs
How can a small business start accepting card payments?
The simplest route is a handheld card reader that takes contactless, Apple Pay, Google Pay and chip and PIN. If you sell online you will also want a payment gateway, and for phone orders a virtual terminal.
What is a PDQ machine?
PDQ stands for Process Data Quickly. It is just another name for a card reader or card machine, the handheld device a customer taps or inserts their card into.
How much does it cost to accept card payments?
Usually three things: a one-off hardware cost, a percentage transaction fee, and ongoing charges like rental and PCI. As a benchmark, debit from around 0.35% and credit from around 0.65%, with PCI around £6 a month.
Do I need a card machine to take payments over the phone?
No. A virtual terminal lets you key in card details from any internet-connected device, with no hardware. These are known as MOTO payments.
Is taking card payments safe?
Yes. The industry is governed by PCI DSS, a mandatory security standard, and modern providers handle most of the compliance work for you.
What is the cheapest way to take card payments?
It depends on volume. All-in-one flat rates with no monthly fee suit very new or low-volume businesses, while tiered pricing usually works out cheaper as your card turnover grows.
Just starting out, or reviewing your setup? Get a free, no-obligation statement review and we will help you find the right way to take payments at a fair price.
Get my free statement review