Chip and PIN Machines for Small Businesses UK
Need to take card payments without overcomplicating things? We explain the main types of chip and PIN machine, what they cost, which setup suits different businesses and when a cheap card reader is enough.
Find a card machine that fits your business
Compare providers using your expected card turnover, where you take payments and whether you need one terminal or several.
What is a chip and PIN machine?
A chip and PIN machine is simply a card machine that can read the chip in a customer’s debit or credit card and let them confirm the payment with their PIN when required.
Modern card machines normally do much more than chip and PIN. Most also accept contactless payments and mobile wallets such as Apple Pay and Google Pay.
You will also hear them called card terminals, payment terminals, PDQ machines or card readers. The important thing is not the name. It is choosing the right type of machine for how your business actually takes payments.
Quick answer for small businesses
If you work alone or take relatively few card payments, start by looking at a low-cost mobile card reader. If you run a shop, café, restaurant or busier business, a standalone portable or countertop terminal may be easier for staff and more reliable day to day.
The four main ways to take chip and PIN or contactless payments
The old approach was to compare dozens of terminal model numbers. For most business owners, it is much more useful to start with the type of setup you need.
| Type | Best for | Main advantage | Main drawback | Useful guide |
|---|---|---|---|---|
| Phone-paired reader | Sole traders, tradespeople, markets, mobile services | Very low upfront cost | Depends on a phone/tablet | Mobile card readers |
| Standalone portable | Cafés, restaurants, salons, busy mobile businesses | Dedicated device with its own connectivity | Usually costs more | Hospitality card machines |
| Countertop | Shops, receptions, fixed checkout desks | Stable fixed setup | Not designed to move around | PDQ terminals |
| Tap to Pay | Occasional payments and backup | No separate hardware needed | Contactless only and phone dependent | Tap to Pay guide |
Does every small business need a chip and PIN machine?
No. You need a way to take the payments your customers want to make, but that does not always mean buying a traditional terminal.
A self-employed electrician might be perfectly happy with Tap to Pay or a £20 to £30 phone-paired reader. A restaurant with several waiting staff needs something completely different.
If you mainly invoice customers or take payments remotely, a Virtual Terminal, payment link or online payment solution may be more relevant than a physical card machine.
The best setup is the simplest one that reliably handles the payments your business actually receives.
How does a chip and PIN payment reach your bank?
When a customer taps or inserts their card, the terminal sends the payment securely through the payment network for authorisation.
The customer’s card issuer checks whether the transaction can be approved. If it is accepted, the payment is later settled to your business through your payment provider.
With a traditional setup, this often involves a merchant account. Providers such as Square and SumUp package the payment processing more tightly with their reader, so a small business does not necessarily need to arrange a separate merchant account itself.
Settlement speed varies between providers. Some offer next-business-day settlement as standard, while others can make funds available quickly inside their own business account first.
How much does a chip and PIN machine cost?
There is no single price because modern card machines use several different pricing models.
Buy the reader outright and pay per transaction
This is common with providers such as Square and SumUp.
Square Reader currently starts at £19 + VAT and charges 1.75% for standard in-person chip and PIN or contactless payments. Square’s standard POS software has no monthly fee.
SumUp Solo Lite currently costs £25 + VAT. Its standard PAYG card-reader rate is 1.69%, with no monthly processing subscription on PAYG.
Rent the terminal and pay processing fees
Traditional card-machine providers may charge a monthly terminal fee alongside transaction charges.
For example, Worldpay’s current small-business Simplicity tariff publishes 1.50% on applicable Visa and Mastercard transactions with an 18-month terminal-hire agreement. Its current DX4000 countertop and DX8000 mobile plans include promotional terminal pricing, subject to eligibility and terms.
This type of setup can become more attractive once you process enough card turnover to justify a proper merchant-services quote.
Tailored pricing
Providers may offer lower or bespoke rates once your card turnover becomes significant.
Dojo, for example, currently publishes a 1.2% blended transaction rate below £100,000 annual card turnover, with custom pricing above that level. Compare the complete package rather than treating one percentage as the total cost.
Our payment processing companies guide explains how these provider models differ.
Best chip and PIN setup for a sole trader
For most sole traders, we would start with a low-cost reader rather than a rented countertop terminal.
Square Reader and SumUp Solo Lite are easy benchmarks because both have cheap hardware and straightforward PAYG pricing.
A plumber, electrician, gardener, personal trainer or mobile beautician can pair the reader with a phone and take payment before leaving the customer.
If you only take occasional contactless payments, Tap to Pay may remove the need to buy separate hardware at all.
See our full card machines for sole traders guide.
Best chip and PIN setup for a shop
A small shop can use either a phone-paired reader or a fixed terminal. The right choice depends on how busy the checkout is.
If the owner handles most sales, a low-cost Square setup may be enough. If several staff use the till all day, a dedicated countertop terminal keeps payments separate from someone’s phone and gives you a more permanent checkout.
Worldpay’s DX4000 is an example of a modern countertop machine with Ethernet and Wi-Fi connectivity.
If you also need stock, staff and till management, compare a complete EPOS system rather than looking only at the payment terminal.
Best chip and PIN setup for cafés and restaurants
Hospitality businesses should usually prioritise mobility, reliability and speed over the cheapest possible hardware.
A standalone portable terminal allows staff to take payment at the table without borrowing the owner’s phone.
Worldpay’s DX8000 is a current example of a standalone terminal with Wi-Fi and 4G connectivity. Providers such as Dojo, takepayments and Clover also target businesses that need more complete payment and POS setups.
See our card machines for hospitality guide.
Best setup for mobile and outdoor businesses
If you work at markets, events, pop-ups or customer locations, connectivity and battery life matter as much as fees.
A phone-paired reader is cheap, but it depends on your phone’s battery and signal. A standalone 4G terminal costs more but gives you a dedicated business device.
For very occasional transactions, Tap to Pay can be a useful backup.
Compare our best mobile card readers and card readers for craft fairs.
Chip and PIN vs contactless
You do not normally have to choose between chip and PIN and contactless. Modern card machines usually support both.
Contactless is faster for everyday payments. Chip and PIN remains important when a contactless transaction cannot be completed or when the cardholder needs to insert the card and enter their PIN.
Mobile wallets such as Apple Pay and Google Pay also use the contactless capability built into modern terminals.
Read our contactless payments guide for more detail.
Do you need a receipt printer?
Not every business does.
Sole traders and mobile services can often send receipts by email or text. Shops, hospitality venues and businesses serving customers who regularly need expense receipts may prefer a terminal with a built-in printer or a connected receipt printer.
Do not pay extra for printing hardware just because traditional card machines used to have it. Match the hardware to what your customers actually ask for.
What connection does a card machine need?
Modern card machines can connect in several ways:
- Bluetooth to a phone or tablet
- Wi-Fi
- built-in 4G or mobile data
- Ethernet for fixed countertop terminals
A reliable connection matters more than saving a tiny amount on the transaction rate. If the machine regularly fails where you work, it is the wrong machine for your business.
What transaction fees should you compare?
Do not compare providers using only one headline number.
Ask about:
- UK consumer debit and credit cards
- commercial cards
- international cards
- American Express
- fixed pence-per-transaction charges
- monthly minimums
- terminal rental
- authorisation or service fees
- refund and chargeback charges
The cheapest provider for a plumber taking 30 large payments a month may be completely different from the cheapest provider for a coffee shop taking 2,000 small transactions.
Compare using your real numbers
Use your monthly card turnover, average sale value and likely number of transactions. That gives you a much more accurate comparison than choosing whoever advertises the lowest percentage.
When does a merchant account make more sense?
PAYG readers are excellent for new and low-volume businesses because they are easy to start and involve little commitment.
As card turnover increases, a dedicated merchant account and negotiated processing package can become more competitive.
If you regularly process £10,000, £20,000 or more a month, it is worth comparing PAYG rates with tailored quotes from established card machine providers.
What about taking payments online or over the phone?
A physical chip and PIN terminal only solves face-to-face payments.
If customers also pay through your website, invoices or over the phone, look for a provider that supports those channels or use a separate service designed for them.
Our guides to payment processors and accepting card payments explain the wider options.
PCI DSS and card security
Using a recognised card machine keeps sensitive payment data inside an approved payment environment rather than your own spreadsheet or notes.
You still have responsibilities under PCI DSS, but using compliant payment hardware usually makes the process much simpler than manually handling card information.
See our PCI DSS guide.
Questions to ask before choosing a chip and PIN machine
- Do I need the device to work without my phone?
- Will several staff need to use it?
- Do customers pay at a fixed counter or around the premises?
- What is my expected monthly card turnover?
- What is my average transaction value?
- What do different card types cost?
- Is there a monthly fee or minimum contract?
- How quickly does money reach my bank account?
- Do I need printed receipts?
- What happens if the terminal breaks?
- Do I also need online or phone payments?
Not sure whether to buy a reader or rent a terminal?
Compare card-machine providers using your expected turnover and how your customers pay. This gives you a clearer view of whether PAYG or a fuller merchant-services package is likely to offer better value.
Frequently asked questions
How much does a chip and PIN machine cost?
Low-cost readers can start from around £20 to £30 plus VAT, while standalone and traditional terminals may cost more or be rented monthly. The processing fees matter more than the hardware price over time.
Do I need a merchant account for a chip and PIN machine?
Not always. Traditional terminal providers normally use a merchant account, while providers such as Square and SumUp bundle the payment-processing relationship more closely with their hardware.
What is the best chip and PIN machine for a sole trader?
Square Reader and SumUp Solo Lite are easy starting points for many sole traders because hardware costs are low and PAYG pricing is straightforward.
Can I use my phone instead of a card machine?
Yes, if your compatible phone and payment provider support Tap to Pay. It is particularly useful for occasional contactless payments or as a backup.
What is the difference between a card reader and a PDQ machine?
The terms overlap. “PDQ machine” is an older UK term for a card-payment terminal, while “card reader” is now commonly used for both small phone-paired devices and larger payment terminals.
Should a busy business use a PAYG reader?
It can, but once your card turnover becomes substantial it is worth comparing tailored merchant-service pricing. A lower transaction rate can outweigh a monthly terminal charge.
Our verdict
The best chip and PIN machine is not necessarily the machine with the longest feature list. It is the one that fits how your business takes payments every day.
For a sole trader or micro-business, Square Reader or SumUp Solo Lite will often be enough. They are inexpensive, easy to understand and avoid a traditional terminal-rental commitment.
For a shop with a fixed checkout, a countertop terminal can be cleaner and easier for staff. For restaurants, cafés and other hospitality businesses, a standalone portable terminal is usually more practical.
As card turnover grows, compare the simple PAYG rates with tailored packages from providers such as Worldpay, Dojo, takepayments and other established merchant-service companies.
Choose on the total cost, reliability and how well the machine fits your workflow, not on an impressive list of technical specifications.
Compare chip and PIN machine quotes
Use your expected turnover and payment setup to compare providers. Looking at the full cost makes it easier to decide between a simple PAYG reader and a fuller merchant-services package.
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