Accepting Payments: Cash, Card, ACH, Stripe, Square

Once you have a business, you have to get paid. The good news is there have never been more ways to accept payments. The trade-off is that each method costs different fees, takes different amounts of time to clear, and carries different risks. Picking the right mix saves real money.

This is plain-English starter content. For broader context, see our Learn hub, the business basics overview, and our bookkeeping basics guide.

The five common methods

Most small businesses use some mix of:

1. Cash
2. Check
3. Credit and debit cards (in person or online)
4. ACH (bank-to-bank transfer)
5. Payment apps (Stripe, Square, PayPal, Venmo for Business, Zelle for Business)

Each one fits some situations and not others. Here is what to know about each.

Cash

The oldest method. No processing fees. The customer pays, you have the money instantly.

Pros: zero fees, no chargeback risk, no waiting. Cons: can be lost or stolen, has to be physically deposited, harder to track, and large cash deposits can trigger bank reporting requirements (the IRS Form 8300 rule covers cash payments of more than $10,000).

Most service businesses can take cash with minimal setup. Just make sure every cash sale is recorded in your books — cash that "disappears" before being recorded is one of the most common bookkeeping problems for small businesses.

Check

Still common in B2B and for big-ticket items. The customer writes a paper check; you deposit it; the bank takes a few business days to clear.

Pros: very low cost (often free), customer-friendly for older clients and certain industries. Cons: can bounce (NSF — non-sufficient funds), takes time to clear, requires physical handling.

A bounced check usually triggers a returned-check fee from your bank, plus the original amount you thought you had. For larger amounts, ACH is generally safer than a check.

Credit and debit cards

By far the most common method for retail and online business. Customers tap, swipe, or enter card numbers; the card network and processor move the money to your account in 1 to 2 business days.

Pros: fast, customer-preferred, works in person and online, builds professional impression. Cons: processing fees (typically 2.5% to 3.5% per transaction), chargeback risk if a customer disputes a charge.

Card processors usually charge a per-transaction percentage plus a small flat fee. There are also monthly fees in some plans. For small businesses, the simplest approach is a flat-rate processor (Square, Stripe, PayPal Here, etc.) that charges one published rate. As volume grows, "interchange-plus" pricing through a traditional merchant services provider is usually cheaper but more complex.

ACH (Automated Clearing House)

ACH is bank-to-bank transfer through the U.S. banking system. It moves money directly from the customer's checking account to yours, usually in 1 to 3 business days.

Pros: much lower fees than cards (often $0.25 to $1.50 per transaction or 0.5% to 1%), great for recurring B2B billing. Cons: slower than card, requires customer's bank account info, harder for one-time consumer transactions.

ACH is the default for things like rent, payroll, and recurring B2B invoices. The IRS uses ACH for EFTPS — its Electronic Federal Tax Payment System — for the same reason: low cost and reliability.

Payment apps and platforms

Stripe, Square, PayPal, and similar platforms bundle card and ACH processing, online checkout, invoicing, and sometimes point-of-sale hardware. Most charge flat per-transaction fees similar to direct card processing.

Stripe is the default for online software and developer-built checkout flows. Square is widely used for in-person retail and small services because of free POS hardware and simple flat-rate pricing. PayPal is the most familiar consumer brand for online checkout.

There are many other options. The right one depends on whether you are mostly in-person, online, or recurring billing — and on whether you need POS hardware. Compare current published rates before signing up; rates change.

How to choose your mix

A useful framework: list how customers actually want to pay you, then add the methods on top of that.

• Coffee shop or food truck. Card terminal (tap and chip), plus cash. Add an Apple Pay/Google Pay reader if your customers are mobile-heavy.
• Plumber or contractor on-site. Card via a mobile reader (so the customer can pay before you leave), plus check and ACH for big jobs.
• Online product seller. Stripe, Shopify Payments, or Square Online checkout. Add PayPal as a familiar second option.
• Service business with recurring monthly clients. ACH via a recurring billing tool (Stripe, Bill.com, QuickBooks Payments). Falls back to card if needed.
• B2B consultant on big invoices. ACH primary, check secondary, card available for clients who insist.

A common mistake is to offer only the methods that are easy for you. Customers who can't pay the way they want often delay payment — or walk.

Fees: do the math

For example, on a $1,000 invoice:

• Cash: $0 in fees, but counting and depositing takes your time.
• Check: $0 to a few dollars in deposit fees.
• Card at 2.9% + $0.30: $29.30 in fees.
• ACH at 0.8% capped at $5: $5.00 in fees.

For a $10,000 invoice, the card fee is $290.30 and ACH is still $5. For big invoices, paying card fees is real money. Letting the customer pick (or steering them to ACH) saves a lot over a year.

Some businesses pass card fees on as a "convenience fee" or surcharge. State laws vary on whether this is allowed, and card network rules add their own restrictions. Check both before adding a surcharge.

Chargebacks

A chargeback is when a card customer disputes a charge with their bank — they say the charge was unauthorized, the product wasn't delivered, or it wasn't as described. The bank pulls the money back from your account, sometimes plus a fee.

You can fight chargebacks with documentation (signed delivery, screenshots of approvals, communication records), but the process is time-consuming and the customer often wins. For high-ticket online businesses, chargebacks can be a meaningful cost. Tips:

• Use clear product descriptions
• Confirm orders by email
• Keep delivery and signature records
• Respond promptly to customer complaints before they escalate to the card network

Security and compliance

If you take card payments, you have to comply with PCI-DSS (Payment Card Industry Data Security Standard). For most small businesses using a hosted processor (Square, Stripe, etc.), the processor handles most of the heavy lifting and you complete a simplified self-assessment questionnaire annually.

The Federal Trade Commission's data security page covers broader customer-data protection. The SBA's accept payments hub covers the basics of setting up. The USA.gov small business hub links each state's banking and consumer protection portals.

This is general info, not legal or financial advice — for compliance specific to your business, talk to your processor and a CPA.

A practical setup

For most new businesses, a simple starting setup is:

1. A business bank account (see our open a business bank account guide)
2. One card processor matching your situation
3. ACH enabled for invoices over a threshold (often $500 or $1,000)
4. A clear written policy on which payment methods you accept and any deposit terms

Get this set up before you need it. Trying to figure out card processing on the day a customer is standing in front of you with a credit card is the worst time to learn how interchange fees work.

Tax laws and SBA programs change every year — always check the latest at IRS.gov, SBA.gov, and your state's Secretary of State website.