Merchant accounts with no monthly feesIt is an unavoidable fact of retail life that processing card payments will incur transaction costs from your merchant account supplier. However alongside these transaction charges, many companies also charge monthly fees for the service they provide – similar to your monthly phone bill. For smaller companies, these charges may not prove viable if they don’t take a lot of card payments, so it makes sense to find a merchant account with no monthly fees.

Some companies offer merchant accounts with a pay-as-you-go plan with no monthly fee; in these cases the transaction fees may be higher. Companies operating in the UK and offering an e-commerce merchant account with no monthly fee include: PayPal, Nochex, Barclaycard ePDQ Essential and Stripe.

In this article we’ll cover:

  1. How merchant accounts work
  2. The 5 best merchant accounts with no monthly fees
  3. Next steps: Finding the best merchant account deals

How Merchant Accounts Work

Businesses that receive payments whether face-to-face, online, by telephone or mobile phone, need a merchant account and a payment gateway in order to transfer funds to their business bank account.

This process is outlined in five simple steps as follows:

  1. A customer pays for products or services by credit or debit card.
  2. The payment is electronically sent to the payment gateway to authorise the payment.
  3. The payment is sent to the relevant credit or debit card company.
  4. Funds are transferred from the customer’s account into the vendor’s merchant account.
  5. Funds can then be transferred into the vendor’s business bank account.

Merchant accounts and payment gateways can be set up using separate providers or they can be rolled into one package supplied by one provider. There are different plans on offer depending on the type and amount of business transactions made.

5 Best Merchant Accounts With No Monthly Fee


PayPal reviewPayPal is the largest online merchant account provider worldwide. Their merchant account and payment gateway is rolled into one package. The Standard PayPal option offers a pay-as-you-go plan with no monthly fee and is suitable for start-up and small businesses.

Payments can be processed via the business website, eBay, email or by mobile phone. For payments up to £1,500, the transaction rate is 3.4% + 20p; for payments between £1,500 and £6,000, the transaction fee is 2.9% + 20p.

The percentage of the transaction fee gets lower, the higher the value of payments processed, for example the transaction rate for payments over £55,000 is 1.4% + 20p. However, a small monthly fee is charged for larger enterprises under the Advanced and Pro PayPal options.


Nochex reviewLike PayPal, Nochex provide an internet merchant account and payment gateway in one package. Their entry level UK Trader Account is free to set-up, with no monthly fee, and is charged on a pay-as-you-go basis of 3.2% + 20p, and is suitable for start-ups and small businesses.

Their standard Merchant Account can receive payments from around the world and has a charge of 2.9% + 20p per transaction.

Nochex offers its account holders free functionality that includes 3DS Secure payment security, UK telephone support and customised payment pages. Nochex also supports the new electronic wallet services from MasterCard and Visa.

Barclaycard ePDQ Essential

Barclaycard Merchant Account reviewThe ePDQ Essential plan provided by Barclaycard is a merchant account service for trading online and is delivered with the option of either pay-as-you-go or a monthly fee.

For pay-as-you-go, a flat-rate of 3.5% is charged for each transaction inclusive of merchant account and payment gateway fees. A joining fee is required to access the pay-as-you-go ePDQ essential payment processing option. An e-terminal allows users to accept mail and telephone order payments.


StripeStripe is a relatively new merchant account provider established in 2013. This company offers online payment services and is available in the US, Canada and the UK.

With Stripe there are very few fees to pay other than the pay-as-you-go transaction fee which in the UK is 2.4% + 20p. No PCI DSS (Payment Card Industry Data Security Standard) compliance is necessary as the stripe.js provides that requirement. Payments can be made via the web or a mobile device.

WorldPay Zinc

WorldPay reviewThe WorldPay Zinc merchant account allows payments to be made to businesses via mobile phone, iPad, iPhone or Android. This company offers a pay-as-you-go plan with no monthly charge.

The charge is 2.75% per transaction inclusive of a 24/7 UK help desk. WorldPay Zinc also offer option payment plans with a monthly charge. For the price of £5.99 per month the transaction fee is reduced to 1.95% and for £12.99 per month there is no transaction fee.

Next Steps: Finding The Best Merchant Account Deals

Google Checkout are no longer providing a merchant account service, although when they were operating there were no monthly fees to pay.

Choosing a merchant account with a monthly contract or a pay-as-you-go
option is dependent on the unique requirements of the business.

All costs and information correct as of time of writing.