PayPal POS Merchant UK Review 2026: Fees, Card Reader, Pros & Cons Quick Answer
PayPal POS , formerly Zettle by PayPal, is a pay-as-you-go point-of-sale and card-payment system aimed particularly at UK small businesses.
Current standard POS pricing includes:
1.75% for card and contactless payments£0 monthly POS software fee£29 + VAT for the first PayPal Reader for eligible new business users£149 + VAT for the PayPal Terminal£199 + VAT for the Terminal with barcode scanner
PayPal also says businesses with high-volume sales can enquire about custom POS pricing.
Our view: PayPal POS is particularly attractive if you want simple pricing, low fixed costs and already use PayPal.
But if you process regular card turnover compare the total cost against merchant-account providers before choosing.
Compare Merchant Account & Card Machine Quotes
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Key Takeaways about Paypal POS Merchant Services
Zettle by PayPal is now PayPal POS.
PayPal POS is a payment service rather than a traditional dedicated merchant account.
Standard card and contactless payments currently cost 1.75%.
There is no monthly or setup fee for the core POS software.
The first PayPal Reader currently costs £29 + VAT for eligible new business users.
The PayPal Terminal currently costs £149 + VAT.
Tap to Pay lets compatible smartphones accept contactless payments without additional hardware.
PayPal now invites high-volume POS businesses to enquire about custom pricing.
We think its strongest appeal is simplicity rather than automatically being the cheapest payment option.
See How PayPal POS Merchant Services Compares With Merchant Account Providers
How do we work?
Our comparisons are researched and reviewed by the Compare Your Business Costs editorial team using provider information, official UK guidance and business buying criteria. See how Compare Your Business Costs works .
Authored by: Ally Cox (Business Technology & B2B Services Specialist, 10+ Years’ Experience)
Last Updated: October 2026
Contents
How Much Does PayPal POS Merchant Services Cost? PayPal POS uses relatively straightforward pricing for standard in-person payments.
Card and contactless payments – 1.75% per transaction
Monthly POS software – £0
Setup fee – £0
PayPal also advertises custom POS pricing for high-volume sales.
That is important because it means larger businesses shouldn’t automatically assume the standard 1.75% rate is their only option.
Our take
The appeal here is simplicity.
If you process £1,000 of standard in-person card payments at 1.75%, the transaction cost is approximately £17.50.
At £10,000 it would be £175.
At £50,000 £875.
As turnover rises, even a small reduction in your effective processing rate becomes more valuable.
So if your business is growing compare PayPal’s custom pricing and merchant-account quotes rather than automatically accepting the standard rate.
Calculate Your Merchant Account Costs
PayPal Reader vs PayPal Terminal PayPal currently has two main hardware routes.
PayPal Reader The first Reader currently costs £29 + VAT for eligible new business users.
Additional Readers are currently £69 + VAT.
The Reader connects by Bluetooth to a compatible smartphone or tablet running the PayPal POS app.
We think it’s the natural starting point for:
Sole traders
Market sellers
Mobile businesses
Small shops
Pop-ups and events
PayPal Terminal The standalone Terminal currently costs £149 + VAT or £199 + VAT with a built-in barcode scanner.
Unlike the Reader you don’t need a separate smartphone or tablet to run the POS app.
The Terminal also includes Wi-Fi and 4G connectivity.
Our take
Choose the Reader if low upfront cost matters and you’re happy using your phone/tablet.
Look at the Terminal if you want a dedicated all-in-one business device.
Don’t spend £149 on the Terminal simply because it’s the more advanced product.
What Does PayPal POS Merchant Services Offer? PayPal POS goes beyond taking card payments and features include:
Card and contactless payments
Tap to Pay
Inventory management
Sales reporting
Product management
Gift cards
Accounting integrations
E-commerce integrations
PayPal Business integration
Tap to Pay
Compatible iPhones and Android devices can accept contactless payments without separate card-reader hardware.
The current standard fee is 1.75% with £0 monthly or setup fee.
Our take
Tap to Pay makes the £29 Reader less essential than it once was so if you’re starting out and only occasionally accept contactless payments try the phone-based setup before buying hardware you may not need.
Is PayPal POS a Merchant Account? Not in the traditional dedicated-merchant-account sense.
PayPal provides the payment infrastructure and manages the payment process through its ecosystem.
This differs from arranging a dedicated merchant-service agreement with providers such as:
Worldpay
Dojo
Tyl by NatWest
Takepayments
Elavon
The PayPal approach can offer simpler setup + straightforward standard pricing + low fixed costs.
Traditional merchant services can offer more individually structured pricing + different hardware/contracts + potentially different economics at scale.
But don’t assume either model is automatically cheaper – Compare the actual numbers.
How Quickly Can You Access PayPal POS Funds? PayPal says POS sales can become available within minutes in your PayPal Business account.
From there, funds can be transferred automatically to your bank account within the same day or manually within two hours, according to PayPal’s current POS information.
Our take
The distinction matters. Available quickly in PayPal isn’t exactly the same thing as settled directly into your business bank account.
When comparing PayPal with merchant-service providers, check where your money lands and how quickly you can use it.
PayPal POS Pros & Cons Advantages
1.75% standard in-person transaction fee
No monthly core POS software fee
No long-term POS contract
Low-cost Reader
Standalone Terminal available
Tap to Pay without additional hardware
Inventory and reporting tools
Useful PayPal ecosystem integration
Custom POS pricing enquiries available for high-volume businesses
Potential Disadvantages
Standard flat-rate pricing isn’t guaranteed to be cheapest for your turnover
Reader requires a compatible smartphone or tablet
Terminal only runs PayPal POS software
More complex businesses may need specialist EPOS functionality
Funds initially sit within the PayPal ecosystem
Who Should Use PayPal POS? We think it deserves particular consideration from Sole traders and mobile businesses
Low fixed costs and Tap to Pay can make getting started straightforward.
Market traders and pop-ups
The Reader is inexpensive and portable.
Small retailers
The POS app includes inventory, reporting and retail features without a monthly software subscription.
Existing PayPal businesses
Keeping payments within the same ecosystem can be convenient.
Growing businesses
Don’t automatically rule it out. PayPal now invites higher-volume businesses to enquire about custom POS pricing.
Our take
We’d be more cautious if your business needs complex hospitality workflows + specialist EPOS + bespoke integrations + multiple sophisticated payment requirements.
At that point, compare dedicated EPOS and merchant-service options too.
PayPal POS Alternatives Square
A close comparison for businesses wanting straightforward card payments plus a broad POS ecosystem.
SumUp
Worth comparing for simple card-reader pricing and low-cost hardware.
Dojo
More relevant where you’re processing regular turnover and want dedicated payment terminals and EPOS integration.
Tyl by NatWest
Worth comparing if you want traditional merchant services with published terminal rental and personalised transaction pricing.
Worldpay
Particularly relevant where you need broader in-person, online, POS or international payment capabilities.
Takepayments
Another option for SMEs looking for personalised merchant-service pricing.
Compare Card Payment Providers
Our View on PayPal POS We think PayPal POS is strongest when simplicity has genuine value to your business.
You can start without a monthly POS software subscription.
You can use Tap to Pay without buying a separate terminal.
Or you can buy a £29 Reader and have a straightforward physical card-payment setup.
That’s compelling for smaller businesses.
But we wouldn’t choose PayPal simply because 1.75% looks easy to understand.
Simple pricing and cheap pricing aren’t necessarily the same thing.
If you’re processing substantial card turnover, ask PayPal about custom POS pricing.
Then compare that against merchant-service quotes using exactly the same:
Monthly turnover
Transaction count
Average transaction value
Card mix
Hardware requirements
Our buying rule would be:
Choose PayPal POS for simplicity, but make it earn the right to remain your payment provider as your turnover grows.
Compare PayPal POS With Merchant Account Quotes
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PayPal POS Merchant Services FAQs Is PayPal POS the same as Zettle?
Yes. Zettle by PayPal has been renamed PayPal POS. PayPal says existing accounts continue to operate in the same way.
How much does PayPal POS charge?
The current standard UK fee for card and contactless POS payments is 1.75%. PayPal also invites high-volume businesses to enquire about custom POS pricing.
How much is the PayPal Reader?
The first Reader currently costs £29 + VAT for eligible new business users. Additional Readers cost £69 + VAT.
How much is the PayPal Terminal?
The Terminal currently costs £149 + VAT, or £199 + VAT with the built-in barcode scanner.
Does PayPal POS have a monthly fee?
There is currently no monthly or setup fee for the core PayPal POS software. Hardware and transaction charges still apply.
Can I use my phone instead of a PayPal Reader?
Yes. Tap to Pay allows compatible iPhones and Android phones to accept contactless payments without separate hardware.
Is PayPal POS good for higher-turnover businesses?
It can be, but don’t simply compare using the standard 1.75% rate. PayPal now advertises custom POS pricing enquiries for high-volume sales, so request pricing and compare it with merchant-account quotes.
Is PayPal POS cheaper than a merchant account?
Not necessarily. The answer depends on turnover, transaction profile, hardware, fixed charges and the merchant-account quote available to your business.
Compare PayPal POS Costs PayPal POS is easy to price.
That doesn’t mean you shouldn’t compare it.
Compare Merchant Account & Card Machine Quotes
Free quotes • No obligation • Compare UK payment providers
Related Payment Guides Hi, I’m Ally Cox , a senior copywriter and blogger at CompareYourBusinessCosts.co.uk, the UK’s trusted platform for comparing business services.over a decade of experience in the B2B sector, I specialise in simplifying complex topics like leased lines, VoIP, business energy, HR and payroll solutions, accounting software, and EPOS systems .HR, copywriting, and business operations- from clocking-in systems to card machines and office technology .informed, confident decisions when choosing products and services that improve efficiency and save money.
