Credit Card Processing in the U.S.: What Small Businesses Need to Know in 2025
If you run a small business, freelance, or sell online, choosing the right credit card processing solution is crucial. From hidden fees to security standards, understanding the U.S. payments landscape can save you money and protect your business.
This guide covers how credit card processing works, the top pricing models and key factors to consider when choosing a provider.
What Is Card Processing?
Credit card processing refers to the steps that allow businesses to accept card payments from customers whether that is in-person, online, or over the phone.
How Credit Card Processing Works
Customer swipes, taps, or enters card info
Payment gateway encrypts and sends transaction
Card network checks with issuing bank (e.g. Chase)
Transaction is approved or declined
Funds are deposited to the business bank account (usually within 1–2 business days)
If you’re evaluating your options, don’t miss how small businesses can choose the best card processor in 2025.
Common Credit Card Processing Fees
| Pricing Model | Description | Best For |
|---|---|---|
| Flat Rate | One fixed fee (e.g. 2.6% + 10¢) | New or low-volume businesses |
| Interchange-Plus | Actual interchange fee + markup (e.g., 1.8% + 20¢) | Transparent pricing for growing businesses |
| Tiered Pricing | Grouped into "qualified" or "non-qualified" rates | Often less transparent – avoid unless clearly beneficial |
Breakdown of pricing formulas above
Percentage (e.g., 2.6%): This is taken from the total transaction amount.
Fixed fee (e.g., 10¢): This is a set fee per transaction, regardless of the sale amount.
For example, if a customer spends $100 and the rate is 2.6% + 10¢, the fee would be:
2.6% of $100 = $2.60
Plus 10¢ = $2.70 total processing fee
Looking to understand more on fees by provider, explore our Best Credit Card Processors for Small Businesses: 2025 Price Guide & Fee Comparison (U.S.)
U.S. Security Standards You Must Follow
All U.S. businesses that accept cards must comply with PCI DSS (Payment Card Industry Data Security Standard). Here are key security features to look for:
EMV Compliance – Required for chip cards (liability shift applies in the U.S.)
P2PE (Point-to-Point Encryption) – Protects card data during transmission
Tokenization – Replaces card data with a secure token
Fraud Tools – U.S. processors like Stripe and Square offer built-in fraud detection
How to Choose the Right U.S. Credit Card Processor
When evaluating providers, considerations include:
Does it support ACH or eCheck? (Popular for U.S. service-based businesses - allows for funds to be be transferred between banks)
Does it integrate with your POS? (Ex: Square with iPad, Clover for restaurants)
Are there chargeback protections? (Important in the U.S. due to consumer rights laws)
Does it work with your accounting tools? (QuickBooks, Xero, etc.)
Popular U.S. Payment Processors:
Square: Ideal for retail, food trucks, and mobile businesses
Stripe: Best for developers and online platforms
PayPal: Widely accepted but higher fees
Helcim: Transparent, interchange-plus pricing
Clover/Fiserv: Customizable POS systems for U.S. retail/restaurants
| Business Type | Best Features |
|---|---|
| Freelancers | No monthly fees, ACH payments |
| Restaurants | POS integration, contactless pay |
| eCommerce | Payment gateway, fraud tools |
| Contractors | Mobile swipers, invoice links |
| Subscription | Auto billing, recurring payments |
| Learn more: Which provider is right for your niche? | |
Learn more which provider is right for your niche? Explore our Best Credit Card Processors by Business Type (2025 Comparison for US) to find the top solutions tailored to your needs.
ScaleUp Tip
Credit card processing in the U.S. isn’t one-size-fits-all and that’s exactly why choosing the right solution matters. Whether you're a freelancer sending invoices, a retail store using a POS, or a growing eCommerce business, the right processor can streamline operations, reduce costs, and enhance customer trust.
In 2025, the landscape continues to evolve with contactless payments, stricter security standards, and smarter integration tools. This means it is critical businesses understand how payment systems work to ensure you stay both competitive and secure.
