A retail store leaving Square for interchange plus (a pricing model where you pay the real card cost plus a disclosed markup) may save money on debit cards and on online and invoice sales, but the savings on in-person sales are smaller and depend on your ticket size and card mix. In NPS’s 2026 pricing study, a model finds the biggest savings online and by invoice, and it says plainly that very small in-person tickets, around $15 and under, save little. This guide shows how to estimate your own savings from your own statements, what the extra costs of switching are, and when staying on Square is the better choice.
The short answer
- Square’s in-person price is 2.6% plus 15 cents on the Square Free plan, per the study’s quote of Square’s published pricing (accessed October 2026). Online and invoices are 3.3% plus 30 cents, and keyed or card-on-file is 3.5% plus 15 cents.
- Your savings depend on how you sell. The study’s model shows the largest gap for online and invoice sales, a smaller gap in person.
- The biggest gap in the study shows up on debit cards and invoices. Debit from large banks is capped by federal rules, while a flat rate charges the full percentage.
- Very small tickets save little. The study says in-person tickets around $15 and under save little by switching.
- Switching has its own costs: hardware, software, your POS data, and contract terms. Count them before you decide.
Start with what Square charges a store
Square is a flat-rate provider. That means it charges one price per sale type rather than passing through the real cost of each card. NPS’s 2026 pricing study quotes Square’s published U.S. pricing for its Square Free plan, accessed October 2026: 2.6% plus 15 cents for in-person payments, 3.3% plus 30 cents for online payments and invoices, and 3.5% plus 15 cents for keyed-in transactions and cards on file. The study notes that the keyed and card-on-file rate applies to phone orders and saved cards.
Square Free Plan Rates
What Square charges per sale type
- In-person2.6% + 15¢In-person paymentsFlat rate, no card-type distinction
- Online or invoice3.3% + 30¢Online payments and invoices
- Keyed or card on file3.5% + 15¢Keyed-in and cards on fileApplies to phone orders and saved cards
Square Free Plan Pricing
Square’s three rates at a glance
| Sale type | Rate | Per-transaction fee |
|---|---|---|
| In-person | 2.6% | 15 cents |
| Online and invoices | 3.3% | 30 cents |
| Keyed or card on file | 3.5% | 15 cents |
For a store, that matters because many stores sell in more than one way. A shop that rings up most sales at the counter but also takes phone orders, sends invoices to regular customers and has a web store is paying three different Square prices. Add up how much of your volume falls into each type before you estimate any savings.
A quick example using only those quoted prices: a $40 in-person sale costs $1.19 on 2.6% plus 15 cents. A $75 sale costs $2.10. A $150 sale costs $4.05. Those are straight arithmetic, not a forecast of your bill, and they leave out anything Square charges for other products such as payouts, software add-ons or disputes.
What interchange plus changes
Every card sale has three costs inside it: interchange, which goes to the bank that issued the customer’s card, assessments, which go to the card networks, and the processor’s markup. A flat rate bundles them. Interchange plus pays the first two as they are for each card and adds one disclosed markup. NPS explains the model, with the other main ones, in its guide to merchant account pricing models.
Because each card is priced by what it costs, a cheap card costs you less and an expensive card costs you more. Over a mix of sales, the question is whether the cheap cards save more than the expensive ones cost. For most consumer retail, the cheap cards that matter are debit cards.
Debit cards: where a store can gain most
Under federal rules (the Durbin Amendment, put into effect as Regulation II), interchange on debit cards from large banks is capped at 0.05% of the sale plus 21 cents, with a 1 cent fraud adjustment. On a $40 purchase, the study says that is about 24 cents. A merchant paying 2.9% plus 30 cents pays $1.46 on the same card, and a store paying Square’s in-person 2.6% plus 15 cents pays $1.19.
Be careful with the phrase “most debit cards.” The cap applies to debit cards from large banks. Debit cards from smaller banks are exempt and cost more. The study’s model assumes that 35% of debit volume comes from those exempt issuers, and it uses higher costs for them. The Federal Reserve has also proposed lowering the cap, and the study calls that unresolved.
Retail debit share depends on your customers and your tickets. The study says debit makes up roughly 30% to 40% of card payments on sales under $100 and about 20% to 25% over $100. It uses a 35% debit share at a $40 ticket, 30% at $75, 25% at $150 and 22% at $300. Those ranges come from NPS merchant experience and are inputs to a model, not survey results. Younger customers use debit more, and luxury and big-ticket purchases lean toward credit. A convenience store and a jewelry store will look very different.
What the study says about in-person and online sales
The study, “The Flat-Rate Tax,” is by Allen Kopelman, the CEO of NPS. It is a cost model built on published rate schedules, not a survey, and it was written by a processor that sells pass-through pricing. Read it with that in mind.
Its headline finding is for online and invoice sales: businesses selling that way pay 19% to 31% less in processing costs on pass-through than on flat rate, across average tickets from $15 to $2,500. In-person sales are a separate channel in the model, and the flat-rate benchmark is Square’s 2.6% plus 15 cents. The model’s inputs assume lower card costs in person than online for both credit and exempt debit, so there is less room between a flat in-person rate and the true cost of the card.
So do not expect the online headline at your counter. For in-person sales, the study’s model shows about 6.5% at a $15 ticket and 19% to 25% from a $40 ticket upward, against Square’s 2.6% plus 15 cents. A store that sells mostly at the counter may see a smaller percentage gain than a store that sells mostly online or by invoice, and should test the result on its own statements. If part of your business is online or by invoice, that part is where the model finds the largest gap.
When staying on Square is cheaper
The study answers this directly. Flat rate is sometimes the better deal. In-person businesses with very small tickets, around $15 and under, save little by switching because per-transaction fees take up a larger share of each sale. Flat rate is also simple for brand-new businesses with very low volume.
NPS’s pricing guide draws the same line. It lists flat rate as best for startups, pop-up shops and merchants processing under $10,000 a month, and it lists interchange plus as best for businesses processing over $25,000 a month and multi-location merchants. A store between those numbers should do the math.
Staying also makes sense when Square is more than a payment processor for you. If your inventory, staff, loyalty, online store and payroll all run on Square, the cost of changing them may be larger than the fee savings. That is a real cost, and the right answer for some stores is to stay. The best moment to compare is when you are already deciding whether to replace a register or open a second location.
What it costs to switch
Fees are only one side of the comparison. Before you leave, find out:
- Whether your current card readers and register hardware will work with a new processor, or whether you must buy new equipment. Ask Square and the new provider.
- What happens to your item catalog, customer list, loyalty points and sales history, and how you can export them.
- Whether you are signing a contract term, an equipment lease or an early termination fee with the new provider.
- What monthly, statement, gateway, PCI and software fees the new provider adds, since these can offset a lower rate.
- How long underwriting takes, and whether you can run both systems side by side for a while.
- What happens to your online store and invoices, if you use them on Square.
NPS describes its retail option, NPS POS, as a point-of-sale system combined with integrated payment processing, with EBT and WIC processing, Apple Pay and Google Wallet, loyalty programs, inventory and reporting, employee tools, self-ordering kiosks and e-commerce capabilities. It says it offers cash discount programs, flat-rate processing and cost-plus pricing options, and monthly POS specials, so contact NPS for the current offer rather than trusting an old price. See the 2026 retail POS guide for details. It also helps to read about common mistakes, such as in credit card processing companies for small business: Q&A.
How to estimate your own savings
You can do a first estimate yourself in an afternoon. Take the last three months of Square reports and write down:
- Total card sales, split into in-person, online or invoice, and keyed or card-on-file.
- Number of transactions in each, so you can see your average ticket for each.
- Total fees Square charged, including any add-ons.
- Refunds and disputes.
- Your share of debit transactions, if Square can report it.
Then divide total fees by total card sales to get your effective rate. Ask a provider that sells interchange plus to run the same three months through its pricing and show you the dollars, line by line. NPS says its statement review is free. The page how much you are really paying on Stripe, Square, PayPal or QuickBooks explains what NPS looks at.
Compare the two numbers as an effective rate and as dollars a year. The dollars matter. A saving of half a percentage point sounds small, but on $400,000 a year in card sales it is $2,000. On $40,000 a year it is $200, which may not cover the cost of changing.
Estimate Your Savings
How to size your savings in an afternoon
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Pull three months of Square reportsWrite down total card sales, split into in-person, online or invoice, and keyed or card-on-file.
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Count transactions per channelRecord the number of transactions in each, so you can see your average ticket for each.
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Find your total Square feesInclude total fees Square charged, including any add-ons, refunds and disputes.
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Calculate your effective rateDivide total fees by total card sales to get your effective rate.
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Ask for an interchange-plus quoteAsk a provider that sells interchange plus to run the same three months through its pricing and show you the dollars, line by line.
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Compare as dollars per yearCompare the two numbers as an effective rate and as dollars a year.
A worked example with a mixed month
Here is a made-up store, used only to show the method. In one month it takes $30,000 in person across 750 sales (a $40 average), $5,000 online across 100 orders, and $2,000 by keyed-in phone orders across 20 sales. On Square’s published prices as quoted in the study, the in-person fees are $780 plus $112.50, or $892.50. The online fees are $165 plus $30, or $195. The keyed fees are $70 plus $3, or $73. The total is $1,160.50 on $37,000, an effective rate of about 3.14%.
Notice what that example shows. The blended rate is above Square’s 2.6% in-person headline, because the online and keyed sales cost more. If most of that store’s growth is online, the flat-rate bill will drift upward faster than the in-person price suggests. Now picture a provider pricing the same month on interchange plus. It needs the card mix, the debit share and the ticket sizes, and it will show a total in dollars. Put the two totals side by side. The example is arithmetic on quoted prices for one side only. It is not a quote, and it does not say what interchange plus would cost.
Run this exercise with your own numbers, and add any other Square fees you pay. Then you will know what you are trying to beat.
Questions to ask before you sign
An interchange-plus quote can hide costs as easily as a tiered one. Get answers in writing:
- What is your markup, as a percentage and a per-transaction amount, and is it the same for debit and credit?
- What monthly, statement, gateway, PCI and batch fees do you charge?
- Is there a contract term or early termination fee?
- Do I own my equipment, or is it leased?
- What do you charge for a chargeback, and do you help me fight one?
- Will you run my last three months through your pricing and show the math?
- Who answers the phone when my register is down on a Saturday?
If a provider will not answer these in writing, treat that as a reason to look at others.
Before You Switch
Questions to get in writing before you sign
- Ask what markup applies to debit and credit separately, as a percentage and per-transaction amount
- Ask what monthly, statement, gateway, PCI and batch fees the new provider charges
- Confirm whether there is a contract term or early termination fee
- Find out whether you own your equipment or whether it is leased
- Ask the provider to run your last three months through its pricing and show the math
- Find out who answers the phone when your register is down on a Saturday
For the full picture across every sales channel and average ticket, read our guide to cheapest payment processing in 2026.
Who wrote this, and where NPS fits
Nationwide Payment Systems (NPS) publishes this guide. We are a payments company based in Fort Lauderdale, Florida, in business since 2001, and we sell merchant accounts and POS systems, so we are not neutral. We offer interchange-plus pricing, retail POS, a payment gateway and invoicing, and we also offer flat-rate and cash-discount programs. We do not publish a price list, because pricing depends on volume, ticket size, card mix and risk. The study we cite was written by our CEO. Browse more in our payments guides or our comparison of NPSOne and Stripe, Square, PayPal and QuickBooks Payments.
We are not the right fit for every store. If your volume is low, your tickets are tiny, or Square runs most of your operations well, staying may cost you less.
Bottom line
A retail store leaving Square for interchange plus may save most on debit cards and on any online or invoice sales, and less on small in-person tickets. NPS’s study is a model from a processor that sells pass-through pricing, and it says flat rate can be cheaper for in-person tickets around $15 and under and for brand-new low-volume businesses. Do not trust any headline, including ours. Take three months of your own reports, ask for a quote on those numbers, and count the cost of switching. If you would like a second opinion on a quote or on your current statement, you can contact our team, and if staying on Square is the better answer, we will say so.
Frequently asked questions
What does Square charge a retail store?
In NPS’s 2026 pricing study, quoting Square’s published pricing for the Square Free plan (accessed October 2026), in-person payments are 2.6% plus 15 cents, online payments and invoices are 3.3% plus 30 cents, and keyed or card-on-file payments are 3.5% plus 15 cents.
How much will I save leaving Square?
It depends on your ticket size, card mix and mix of in-person and online sales. For in-person sales, the study’s model shows about 6.5% at a $15 ticket and 19% to 25% from a $40 ticket upward, against Square’s 2.6% plus 15 cents. Its 19% to 31% finding is for online and invoice sales, so get a quote on your own statements.
Why do debit cards matter for savings?
Debit cards from large banks are capped by federal rules at 0.05% plus 21 cents, with a 1 cent fraud adjustment. A flat rate charges the full percentage anyway. The cap does not cover debit cards from smaller banks, which cost more.
When is Square cheaper?
The study says flat rate can be cheaper for in-person tickets around $15 and under and for brand-new businesses with very low volume. It may also be cheaper when Square runs your inventory, staff and online store and the cost of changing is high.
Can I keep my Square hardware with another processor?
Ask both Square and the new provider before you sign. Compatibility depends on the equipment, so get the answer in writing.
Does NPS offer a POS for retail stores?
Yes. NPS describes NPS POS with integrated payment processing, EBT and WIC, loyalty, inventory, reporting and e-commerce capabilities. Ask NPS for the current offer.
Does NPS review my current statement for free?
Yes. NPS offers a free statement review. Send a recent statement and ask for the math on your own sales.
