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Square vs. PayPal Here: What’s best for your business?

Each point-of-sale system offers its own perks and either could work for you – depending on your business


While Square and PayPal Here are the two biggest contenders in the POS space, it comes down to the type of business you manage – and which bells and whistles you can do without.

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To accept debit and credit cards on the fly, you’ll need a point-of-sale (POS) system that lives on your mobile device – typically your smartphone or tablet.

The cash-only approach doesn’t cut it anymore – even if your business is as occasional as selling heirloom tomatoes at the local farmer’s market. A 2018 Pew Research Center survey found that 29% of U.S. adults make no physical currency purchases in a typical week – so if those customers are not bringing the cash, more than a quarter of your potential sales are forfeited.

PayPal Here and Square are the two biggest contenders in this space. You won’t fail with either but to make the best decision for your business, it will help to understand more about each.

Both use devices that connect to your smartphone and neither Square nor PayPal force you into a contract. With mobile point-of-sale (mPOS) devices becoming easier and easier to integrate, it’s time to take payments to go.

See related: How to accept credit cards at your next garage sale

PayPal Here

PayPal Here is an app and card reader that offers two options: a mobile card reader which allows you to take debit and credit card payments, and a chip-and-swipe card reader for a greater span of payment methods. These include magnetic strip cards, chip cards, Apple Pay and Google Pay.

According to Randa Kriss, the small business specialist for Fundera, a company that supports the financing endeavors of entrepreneurs, PayPal Here is ideal if you want to just make mobile transactions but not much else. It doesn’t take the place of a countertop register.

“It’s good for occasional, in-person credit card transactions,” says Kriss. “Maybe you’re a massage therapist, do makeup, are a photographer – that kind of thing. You operate in cash most of the time but don’t want to limit yourself.” This is where PayPal Here can come in handy. Pop it on your device, take your customer’s card and you’re done.


With every mPOS system, there are going to be fees attached. However, PayPal Here is one of several companies offering low-cost services that don’t require investing a bunch of money in new technology.

Here’s a closer look at the fees associated with PayPal Here:

  • Swipe fee: 2.7%.
  • Keyed entry fee: 3.5% plus 15 cents.
  • Online and invoiced transactions: 2.9% plus 30 cents.
  • Chargeback fee: $20.

As for card readers, PayPal Here offers three different types: a mobile card reader, a chip-and-swipe reader and a chip-and-tap plus charging stand.

The mobile card reader plugs into your smartphone or tablet and is best for business with monthly sales under $500. The device is free when you sign up for PayPal Here (and is valued at $14.99).

The chip-and-swipe reader is the most popular and is ideal for businesses that take payments on the go or in store. The reader accepts both magstripe and chip cards and is free when you sign up for the system (valued at $24.99), but only until December 31, 2019.

The chip-and-tap plus charging stand combination is best for restaurants, retailers or other counter-based businesses that bring in a lot of revenue. It accepts everything the chip-and-swipe reader does along with contactless payments like Apple Pay or Google Pay. It is available for purchase at $79.99.

Integrations and add-ons

PayPal has not developed its own business software solutions. Instead, it partners with other companies so you can manage your business operations with helpful add-ons. Integrations include website checkouts for e-commerce, since it supports most major shopping carts, as well as software for:

  • Accounting needs.
  • Form building.
  • Managing events.
  • Conducting email marketing.
  • Invoicing and billing.


Square is another mPOS but offers several different iterations – including a standard POS system.

As with PayPal Here, you’ll download the app and order a card reader that plugs into your device. At that stage, you’ll be able to accept the full gamut of cards. Also, not only will Square allow you to make a charge, the software is designed to help you do much more.

“Square has a lot of bells and whistles,” says Kriss. “If you need to dive into the numbers and do more complicated tasks, this is the POS for you. It’s perfect for splitting checks, helping with inventory, invoicing and exchanges.”


The fees associated with Square and PayPal Here are similar. Your deciding factor may come down to what kind of card reader is best for your business.

Here are Square’s costs in more detail:

  • Swipe fee: 2.6% plus 10 cents.
  • Keyed entry fee: 3.5% plus 15 cents.
  • Online and invoiced transactions: 2.9% plus 30 cents (or 3.5% plus 15 cents if processed using Card on File).
  • Chargeback fee: None.

When it comes to card readers, Square offers an array of options. The most basic are the Square Readers for magstripe cards. There are two versions: one for Android and one for iOS. Both connect to your device and are free at sign-up.

The next option up is the Square Reader for chip cards and contactless payments. This option is ideal for both countertop sales and on-the-go payments. The reader is $49, or you can pay $17 a month for three months.

The Square Terminal is another option but works best for countertop sales. It’s an all-in-one credit card machine for payments and receipts. The terminal accepts chip and magstripe cards along with contactless payments.

You can purchase the Square Terminal for $399, or you can pay $37 a month for 12 months. Also, if you’re new to Square, a $300 reimbursement is available on the terminal – bringing your eventual total to only $99.

If you already have and use an iPad, the Square Stand might be for you. It’s one of the more popular card readers as it’s ideal for retailers and restaurants. The stand costs $199 (or $18 a month for 12 months) and accepts all the same payment methods as the Square Terminal.

The Square Register is the big kahuna – a fully integrated POS terminal that requires no extra tablets or apps. It comes with hardware, software and accepts all payments. You can either buy the terminal outright for $999 or pay $49 a month for 24 months.

Integrations and add-ons

Unlike PayPal Here, Square has developed extensive internal business management software, and provides the extra add-ons for purchase. These include tools for:

  • Employee management.
  • Payroll.
  • Marketing and loyalty programs.

In addition, Square offers third-party integrations for e-commerce, as well as:

  • Accounting.
  • Invoicing.
  • Timekeeping.
  • Inventory.

A few considerations

  • A suite of cool tools is nice but only important when you use them. It won’t hurt to have them but perhaps you’re more comfortable with a simpler system. Only you know.
  • If your customers use PayPal and you want to make sure that option is available to them, you’ll probably want to go with PayPal Here – Square doesn’t accept it. Other than that, both POS systems take the same cards.
  • If you’re in a special hurry to claim the money you make, PayPal Here has the advantage since the funds will be deposited into your PayPal account with near immediacy. For Square, the transaction can take a couple of days.
  • When things go wrong or if you need to ask questions, good customer service and technical support will be important. PayPal Here has the upper hand in this area, since it lists a phone number and offers email support. With Square, you’ll have to go through their online help center and then you may gain access to a phone number.
PayPal HereSquare
Takes all major card typesYesYes
Takes PayPal paymentsYesNo
Swipe fee2.70%2.60% + 0.10 cents
Key entry fee3.5% + 0.15 cents3.5% + 0.15 cents
Online + Invoice transactions fee2.9% + 30 cents2.9% + 30 cents
Chargeback fee$20None
Price for reader that takes magnetic stripe cardsFreeFree
Price for reader that takes magstripe + chip cards$24.99 (or free with promotion)$49
Price for reader that takes magstripe + chip cards + contactless payments $79.99$49 – $999
Integrations and add-onsPartners with other companiesHas own suite of products
Funds immediately available YesNo
Easy customer service/tech supportYesNo

What you can be sure of is that both POS systems are safe and convenient ways to get paid without having to be tethered to a register. There are no monthly fees or costs for termination of services, so if you find that you’d rather not use the system, all you have to do is stop.

But you won’t have to turn down customers for whom cash is an increasingly foreign concept in the meantime.

Also, be aware that PayPal and Square aren’t the only players in town. As technology marches on – as it always does – more options arrive on the scene. SumUp, LightSpeed, PayAnywhere, Shopify, Clover and many more have burst into the POS scene, so choices abound.

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The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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