Best Merchant Accounts for Small Business (UK 2025)

If you want to take customer payments digitally, you may be trying to decide which merchant account to open. A merchant account is sometimes used to receive online payments before you withdraw your funds to your business account, and may be provided by your payment processor. This guide walks through how merchant accounts for small businesses work, and some to look out for.

Want something different? Accept customer card payments in 18+ currencies with no need for a separate merchant account, with Wise Business. Wise lets you get paid by card or with local and SWIFT account details, payment links and QR codes - all with no ongoing charges and just low, transparent transaction fees.

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What is a merchant account and how does it work?

Online merchant accounts for small businesses allow you to collect customer payments digitally, when your customer pays by card, using an e-wallet, or with a local payment method like Klarna.

When a customer pays online, there are several parties involved, including a payment gateway which securely transmits your customer’s financial information to the payment processor. The payment processor then liaises with the customer’s bank or card provider to ensure the payment can be accepted. Once the bank gives the OK, the money is deposited to the merchant account.

Merchant accounts can be standalone services, but they’re often provided by the payment processor you use to connect with customers and take card payments securely and conveniently.

Merchant accounts aren’t like business bank accounts as they’re not intended for day to day transactions. Instead you may use a merchant account to receive incoming payments, before withdrawing the funds to your business account to use for transacting later.

Why is a merchant account important to accept payments?

Many of the best merchant accounts for small businesses are provided by major payment processing services which also offer a full end to end payment processing service. You may use a merchant account as a kind of intermediary, to have funds deposited there from customers’ online and card payments before you move it to your main business account. However this isn’t always necessary.

Some business accounts also offer payment services alongside your day to day financial management tools. A provider like Wise Business, for example, offers payment processing including card payments and incoming bank transfers, which are deposited right into your Wise Business account with no need for a separate merchant account. This can be more convenient and means you get instant access to your money once a payment has been processed.

💡 Learn more about Wise Business

How to set up a merchant account for a small business?

In most cases, UK small businesses can set up a merchant account online with a standalone provider or the payment processor they’ve selected.

You’ll normally be able to set up a provider account online or in an app quite quickly and you can then choose the ways you want to use the provider, including no code options to receive online payments through your website or digital invoices.

Pricing and fees for merchant accounts in the UK

Merchant accounts in the UK can have very varied approaches to fees, which means you’ll need to shop around to pick the right option for your business needs. You might find you need to pay a monthly fee for your merchant account, for example, but not all providers have ongoing costs. Pretty much all services will then charge a per transaction fee, which may get cheaper for customers who upgrade to an account with a higher monthly fee.

Compare a few different UK merchant account options, looking carefully at the following:

• Monthly fees which may include additional features and services
• Per transaction fees which can vary based on the payment type and where it is initiated from
• Currency conversion fees if you’re taking foreign currency payments
• Withdrawal fees when you need to move the money to your business account

We’ve got some great ideas coming up to help start your research into the best merchant accounts for small businesses.

Best merchant accounts for small business

There are lots of different merchant accounts for small businesses, often offered alongside end to end payment processing tools. When assessing different online merchant accounts for small businesses, you’ll want to look at the feature availability, costs and how reliable they are likely to be, based on reviews from their current customers.

To help you compare the best merchant accounts for small businesses we've picked out a few for a head to head comparison, with more on each provider coming up right after:

Provider	Trustpilot score	Transaction fees	Best for
Stripe¹	2 stars, Poor, from 16,000+ reviews⁶	No monthly fees Payments from 1.5% + £0.20 for standard UK cards¹¹	No monthly fee processing options
Square²	4.2 stars, Great, from 3,000+ reviews⁷	Monthly fee £0 or £29 Online payments from 1.4% + £0.25 for transactions with UK cards¹²	Selection of tools for restaurants, retailers or appointment-based businesses
Worldpay³	4.3 stars, Excellent, from 8,000+ reviews	Fees available on request	Larger businesses in the UK looking for custom pricing
Sumup⁴	4 stars, Great, from 27,000+ reviews⁹	Monthly fee £0 or £19 Payments from 0.99% for the Payments Plus account, or from 2.5% for the pay as you go option¹³	Discounts on POS equipment for plan holders
Adyen⁵	1.4 stars, Bad, from 300+ reviews¹⁰	No monthly fee or set up fee Payment fees vary a lot depending on payment method and customer location¹⁴	Huge range of payment options with transparent pricing

*Details correct at time of research - 29th June 2025

Stripe

Best for: No monthly fee processing options with a very good choice of payment methods

Trustpilot: 2 stars, Poor, from 16,000+ reviews

Key fees: No monthly fees, Payments from 1.5% + 0.20 GBP for standard UK cards

Stripe offers comprehensive payment processing services and merchant accounts for UK businesses. Take one off and recurring payments with cards, local payment methods, and from banks, as well as getting options for extras like fraud prevention tools. There are no monthly fees so you only pay for the services you need.

Read our complete Stripe Review.

Square

Best for: Selection of tools for restaurants, retailers or appointment-based businesses

Trustpilot: 4.2 stars, Great, from 3,000+ reviews

Key fees: Monthly fee 0 GBP or 29 GBP, Payments from 1.4% + 0.25 GBP for transactions with UK cards

Square offers services on a pay as you go basis, and has tools specifically designed to help restaurants, retailers or appointment-based businesses with a monthly fee. You can process payments locally and internationally, and Square has a Great Trustpilot rating showing it is well liked by customers in the UK.

Read our comparison between Stripe and Square.

Worldpay

Best for: Larger businesses in the UK looking for custom pricing

Trustpilot: 4.3 stars, Excellent, from 8,000+ reviews

Key fees: Fees available on request

Worldpay processes many of the payments which are made on a day to day basis in the UK and works with large and small businesses alike. Worldpay does not market plans or advertise pricing - instead everything is done on a custom made basis so you can get the package which suits your needs.

Read our comparison between Stripe and Worldpay.

SumUp

Best for: Discounts on POS equipment for plan holders, allowing for offline payments more cheaply too

Trustpilot: 4 stars, Great, from 26,000+ reviews

Key fees: Monthly fee 0 GBP or 19 GBP, Payments from 0.99% for the Payments Plus account, or from 2.5% for the pay as you go option

Sumup has different pricing options including a pay as you go account which has higher per transaction processing fees, or an account with monthly charges and lower processing fees. This allows you to select the plan which meets your volume needs best - per transaction fees on the Payments Plus account start from just 0.99% which is pretty good compared to competitors.

Read our complete SumUp review.

Adyen

Best for: Huge range of payment options with transparent pricing

Trustpilot: 1.4 stars, Bad, from 300+ reviews

Key fees: No monthly fee or set up fee, Payment fees vary a lot depending on payment method and customer location

Adyen is a global provider which has payment processing tools for a vast array of payment types. Pricing is very varied depending on the payment type, but you can get paid using cards, bank services and local payment methods from around the world, including Buy Now, Pay Later services.

How to choose a merchant account?

Before you choose a merchant account, think carefully about the type of transactions you expect to take frequently and the volume of payments you anticipate. Different providers have their own fees, so selecting one which has the lowest possible costs for the types of payment you take often can keep your costs down overall.

If you have a relatively high turnover you might also find it’s worthwhile to negotiate a custom package from your preferred payment processor or provider - you may be able to get better terms on your fees this way if you use the account a lot.

Simplify online payments with Wise Business

Complex payment gateway integrations are in the past, you can start accepting credit and debit card payments in 18+ currencies in minutes with Wise, no code required.

Just send a payment link, invoice, or QR code to your customers, and let Wise handle the rest, ensuring timely payments and improving your cash flow. This streamlined approach wipes out the technical challenges and time-consuming setup associated with traditional payment gateways, allowing you to focus on what truly matters: growing your business.

Say goodbye to high and complex payment processing fees. Wise Business offers a transparent, low-cost solution with just 1% fee for domestic cards and 2.9% for international and business cards.

And once the payment is done you can manage multiple currencies effortlessly, all in one account. Enhance your customer relationships and support your business's global expansion with a payment solution that prioritises simplicity and efficiency.

Get started with Wise Business 🚀

FAQs - merchant accounts for small businesses

What is the difference between a merchant account and a payment gateway?

A payment gateway and a merchant account are both used to process digital payments but they’re not the same thing. When a customer makes a payment online the sensitive financial details are handled by the payment gateway which encrypts them and securely passes the details on so they go to the customer’s bank for approval. Once the transaction is processed, the funds are deposited in the merchant account.

Are there alternatives to traditional merchant accounts for small businesses?

Yes. A merchant account isn’t always needed with providers like Wise Business. You can use your Wise Business account to accept global online payments from cards and banks, and have the funds deposited into your Wise account directly rather than having to go through a merchant account as a staging post.

Can I use the same merchant account for online and in-store payments?

Whether or not you can use the same merchant account for online and in-store payments depends on the specific provider you pick. Many do offer offline payments, which can mean you use one unified service for all your incoming funds.

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Whether you get a merchant account from a standalone service or a payment provider, the account will operate in a similar way. Funds from digital payments are deposited into your merchant account and you can then withdraw the money to your business account later. If you’d prefer you can skip this step entirely with an account from Wise Business which lets you receive customer card payments to your main Wise account with no merchant account required.

Sources used in this article:

1. Stripe
2. Square
3. Worldpay
4. Sumup
5. Adyen
6. Stripe Trustpilot
7. Square Trustpilot
8. Worldpay Trustpilot
9. Sumup Trustpilot
10. Adyen Trustpilot
11. Stripe pricing
12. Square pricing
13. Sumup pricing
14. Adyen pricing

Sources last checked 29/06/2025