Card readers; why do we use them, what are they for and which are the best readers available? Let’s dive behind the curtain and find the best tools to run your business and get paid as easily and fast as possible, and explore what’s coming over the horizon.
This blog is all about card readers, their costs and what your best choices may be. When we’ve been out speaking with our customers, and blitzing the high street for info we’ve seen some common themes, which we’ll dig into here…
In our pocket, wherever we go, there’s a phone more powerful than the computer which took us to the moon. Every shop we visit we take it out, double tap the button on the side, and tap the phone on a little box of plastic which gives a satisfying beeeep. This is all based off tech that’s over half a century old, today we’re going to dive into this, and explore one core element, the card reader.
Ever since cards came around we’ve been using these little plastic boxes to get paid by our customers. They come in all shapes and sizes from the black boxes of the 1990s all the way through to the sleek white squares and mobile-based doohickies that we have today.
From our experience running a cafe needs speed, simply put, you need the Ferrari of card readers. Customers today expect to pick up what they want, and leave in no time at all, and any obstacles in their way are just extra clutter. From your POS and card reader, to your loyalty system, you’ll need to be blazingly fast.
There are so many options out there, from the old school black boxes of Muira and Verifone to newer, slicker systems like iZettle, SumUp and my two favourites Square and Dojo. There are really only two options of card readers if you really want to up your game.
Square is possibly your best option for a card reader. Their system is beautifully slick and they have a powerful ecosystem that’s ready to go with very little held back. Starting off serving farmers’ markets, Square have evolved to suit the cafe environment. They don’t really have card readers anymore, with the reader built into the POS. This is great, but it also limits your options with placement, and costs you dearly, but we’ll touch on this later on.
DoJo is the other player who have built a really powerful system, they used to be called Paymentsense and rebranded in 2021. Now they have a very simple and intuitive platform, with both the POS and card reader bundled into one large phone-sized device. Very simple and easy to use, you can’t really go wrong here.
Square and Dojo are the clear winners if you want the right blend of speed and stability. But there’s another system above even those who are pushing the limits of what’s possible with payments and your customers’ experience…
All of these are still plastic boxes which have cards at their core (hence the name card reader). This falls nicely in line with what we’re working on here at Trilo.
Like with card payments, you’ll still use your phone with Trilo, but you’ll no-longer be trapped to the box of plastic. Your customers just scan a QR code that’s on your products or tablet/phone, then pay. With no cards, apps, or hardware needed on either side, we’re helping establish the next era of shopping.
We think the next era of customers paying won’t include card machines or readers at all, your customers will walk in, scan their items and fill their basket, pay and leave. And with no queues or hardware in sight, both your team and your customers are able to have a more enjoyable, faster and higher spending experience. That’s why we’re building help to help us all take the leap and move into the net era of shopping.
When it comes to setting up your payments system the options from a cost point of view can vary wildly, from cheap and cheerful costing just 0.3%-0.4% (on top of your acquirer fees), to 1.75%+ for the card machine, POS system and stock management system.
You’ll also more than likely find an extra £25-£50 thrown in that you’ll need to pay for a card reader up front, and then sometimes a monthly feed to “rent” it.
If we take Square as an example, for transaction fees you’ll be paying 1.75% per payment in fees which rockets up to 2.5% if someone needs to pay you over the phone. And every online payments has an extra 25p.
When we come on to the upfront and rental fees you’ll be paying from £16 all the way to £599 depending on what you’re looking for. If you’re running a market stand, or small shop you shouldn’t need to spend any more than £100, but you can blow things and shell out a cool £599 + VAT.
Alongside these you’ll have an app which can run your business on your phone that syncs with the Square reader. And unlike other companies you won’t need to pay a monthly subscription for Square.
If we take a look at Dojo, it’s a slightly different structure. You’ll be paying 1.4% + 5p in transaction fees on everything you make. This rises to 1.9% + 5p if you take a payment over the phone. But you’ll also pay a monthly subscription of ~£20 a month for to rent your card terminal from them. And there’s a monthly minimum of £24.50, which is pretty achievable in the grand scheme of things.
Now, where does Trilo sit I hear your ask? As Trilo runs from your tablet or phone, there’s no machine rental or purchase needed, and you can get moving with no set up fee. As we also don’t use cards, we’ve got rid of transaction fees in their entirety. So when you get paid £100 by a customer, you keep £100.
Alongside card readers you’ve got several alternatives to get paid, ranging from Trilo to Cash and even AliPay if you have customers shopping from China.
Although Cash may seem “Free” to accept, it’s got a cost like almost everything. You’ll need to store it, and transfer it to the bank, then as you’re depositing the cash in your account you’ll be spending on average £1 for every £100 you deposit, bringing the total real cost of cash acceptance to ~1.2%.
AliPay have also had a big push recently into the UK, and could be a fit for you if you have lots of customers from China. This is one of two national payment system in China, and is how most of their consumers are used to paying. Look at AliPay as a nice to have extra, don’t base your whole payments acceptance around this, as most British customers won’t be able to use it.
Finally, of course you have us at Trilo 👋. Trilo can sit snuggly alongside you card and cash operations, or substitute them entirely. Using Open Banking we’re able to power the majority of customers in the UK, and with new features coming every week foreigner customers will be able to pay with Trilo in 2023 too. No hardware or software is needed by either side, and you’ll get your money immediately with no fees.
Well, that’s a quick summary of Card Readers and their alternatives folks, stay tuned for our next blog inbound soon!
From Hamish & the team @ Trilo