Cheapest Merchant Accounts UK: Lowest Fees Compared
What Makes a Merchant Account "Cheap"?
The cheapest merchant account isn't always the one with the lowest headline rate. Total cost depends on your monthly volume, average transaction value, and whether the provider charges monthly fees, PCI fees, or minimum service charges.
A provider charging 1.69% with no monthly fees may be cheaper for a market trader doing £2,000/month, but a business processing £50,000/month would save significantly more on an IC++ deal at 0.3% + interchange — even with a £20/month platform fee.
Cheapest Merchant Account Providers UK 2026
| Provider | Transaction Fee | Monthly Fee | Contract | Best For |
|---|---|---|---|---|
| SumUp | 1.69% | £0 | None | Micro businesses |
| Square | 1.75% | £0 | None | Small businesses |
| Zettle (PayPal) | 1.75% | £0 | None | PayPal users |
| Takepayments | From 0.4% + IC | From £17 | 12 months | Growing SMEs |
| Global Payments | From 0.3% + IC | From £20 | Negotiable | Higher volume |
| Worldpay | From 0.3% + IC | From £20 | 18 months | Established retail |
Cost Comparison by Monthly Turnover
Here's what you'd actually pay per month with each provider at different volumes:
| Monthly Turnover | SumUp (1.69%) | Square (1.75%) | IC++ (0.3% + IC avg 0.6%) |
|---|---|---|---|
| £2,000 | £33.80 | £35.00 | £38.00 (+ £20 fee) |
| £5,000 | £84.50 | £87.50 | £65.00 (+ £20 fee) |
| £10,000 | £169.00 | £175.00 | £110.00 (+ £20 fee) |
| £25,000 | £422.50 | £437.50 | £245.00 (+ £20 fee) |
| £50,000 | £845.00 | £875.00 | £470.00 (+ £20 fee) |
As the table shows, blended-rate providers are cheapest below ~£3,000/month. Above that, IC++ pricing saves significantly more. Use our free comparison tool to calculate your exact costs.
How to Get the Cheapest Rate
- Compare at least 3 providers — rates are negotiable, especially for businesses processing over £10,000/month.
- Ask for IC++ pricing — blended rates are simpler but almost always more expensive at scale.
- Check total cost — include monthly fees, PCI charges, and authorisation fees, not just the headline rate.
- Avoid long contracts — if a provider won't offer a rolling contract, their rates probably aren't competitive.
- Review annually — providers frequently increase rates after the first year. Set a reminder to re-compare.
Get a free fee review from our panel of FCA-regulated providers and find out if you're overpaying.
Frequently Asked Questions
What is the cheapest merchant account in the UK?
For low-volume businesses, SumUp (1.69% per transaction, no monthly fees) is typically the cheapest. For businesses processing over £10,000/month, an IC++ deal from providers like Takepayments or Global Payments often works out cheaper overall.
Can I get a merchant account with no monthly fees?
Yes. Square, SumUp, and Zettle all offer merchant accounts with zero monthly fees — you only pay per transaction. The trade-off is a higher per-transaction rate compared to traditional providers.
What hidden fees should I watch for?
Common hidden fees include PCI non-compliance charges (£30–£100/year), minimum monthly service fees, early termination fees (£200–£500+), statement fees, and authorisation fees (1p–3p per transaction).
Is it worth switching merchant account provider?
If you haven't compared rates in the last 12 months, almost certainly yes. UK businesses overpay by an average of £1,200–£3,600/year on card processing fees, especially those on rolled-over contracts.