UK SME guide · Updated May 2026

Cheapest Payment Processors for UK Businesses (2026)

Stripe, Square, SumUp, Worldpay and Zettle compared on real per-transaction cost for UK SMEs.

Compare processor cost for your volume →

Headline UK rates (May 2026)

  • Stripe — 1.5% + 20p (UK cards), 2.5% + 20p (EU), 3.25% + 20p (international).
  • Square — 1.75% in person, 1.4% + 25p online (UK).
  • SumUp Air — 1.69% in person, no monthly fee, no contract.
  • Zettle by PayPal — 1.75% in person, 2.5% invoice.
  • Worldpay — Negotiated (typical 0.75%–1.5% + 5p–12p) plus monthly terminal rental.

Run your real numbers in the Payment Processor Comparison.

Choosing by use case

Pure online / SaaS: Stripe — lowest UK rate and best developer tools.

Cafés, salons, market stalls: SumUp Air — cheapest hardware, no contract.

Multi-site retail with EPOS: Square — strongest free POS bundled.

£250k+ annual card revenue: Get quotes from Worldpay, Adyen and Barclaycard. The negotiated rate will beat anyone above.

Hidden costs to budget for

  • Chargeback fees (£15–£25 per disputed transaction)
  • International / Amex surcharges (typically +1%)
  • Currency conversion (Stripe 2%, Wise/Revolut Business significantly less)
  • Terminal rental — only Worldpay-style legacy acquirers still charge this
  • Payout speed — instant payouts cost 1.5% extra on Stripe and Square

Frequently asked questions

+Who is the cheapest UK card payment processor in 2026?

For low-volume in-person taking, SumUp Air at 1.69% is usually cheapest. For online-only payments, Stripe at 1.5% + 20p (UK cards) is hard to beat once you exceed about £2,000/month. Use the comparison tool for your specific volume.

+Are payment processor fees VAT-exempt in the UK?

Yes. Card processing fees from Stripe, Square, SumUp, Worldpay and Zettle are exempt from UK VAT under the financial services exemption, so there's no VAT to reclaim.

+What's the difference between merchant service charge and gateway fees?

MSC is the per-transaction percentage. Gateway fees are a separate charge for the technology that submits the transaction — Stripe and Square bundle them; Worldpay and traditional acquirers usually don't.

+Is Stripe really cheaper than a high-street merchant account?

For under ~£20k/month in card revenue, almost always yes. Above that, a negotiated Worldpay or Adyen deal at 0.7–1.1% can win — but only with a fixed contract.

Related tools & guides

From the smallmediumbusiness.co.uk blog