Square VS QuickBooks: Which Is Better For Payments, Invoicing, & Small Business Management?
QB is best known for accounting, but it now also has QuickBooks GoPayment for mobile processing and a card reader to compete with Square.
|Ideal For||Small or seasonal businesses, new merchants||Small retail or eCommerce businesses, existing QuickBooks users|
|Monthly Subscription Fees||Starting at $0.00||$0.00-$20.00/month + QuickBooks subscription (starting at $25.00/month)|
|Payment Processing Rates||2.6% + $0.10 (swiped/dipped/tapped), 2.9% + $0.30 (online)||Starting at 1.6% + $0.30 (swiped/dipped/tapped), starting at 2.9% + $0.25 (invoiced/online)|
|Standout Features||Month-to-month billing, predictable flat-rate pricing, affordable processing hardware||Month-to-month billing, predictable flat-rate pricing, seamless QuickBooks integration|
|What’s Missing||Account stability issues, not available for most high-risk industries, expensive at high processing volumes||High per-transaction fees, slow deposit times, inconsistent customer support|
|What’s Next||Visit Site
It might seem counterintuitive to compare Square vs. QuickBooks, given that one company is best known for being a small business-friendly payments processor and the other is a long-established accounting software provider. However, both companies have greatly expanded their range of available products and services in recent years, and they now overlap in many areas.
Square and QuickBooks offer a full range of products and services for just about any business, although those offerings can be a bit basic at times. One key difference, of course, is that Square doesn’t offer its own accounting software (not yet, at least). It does, however, integrate well with QuickBooks accounting products if you’d prefer an “all of the above” option instead of choosing just one of these two providers for your business needs.
In this article, we’ll cover everything you need to know about both Square and QuickBooks and how their competing services stack up against each other. We’ll also offer some advice on which company is a better choice, depending on the nature of your business.
Table of Contents
- Square VS QuickBooks: The Basics
- The Key Differences Between Square & QuickBooks Payments
- QuickBooks VS Square Rates & Fees
- QuickBooks Payments VS Square: Comparing Core Features & Services
- Square & QuickBooks Integrations
- Which Is Best For My Business Needs: QuickBooks Payments Or Square?
- QuickBooks VS Square Comparison: The Final Verdict
Square VS QuickBooks: The Basics
Both Square and QuickBooks aim to provide every product and service your business will need. However, QuickBooks relies primarily on third-party providers, while Square focuses mainly on proprietary in-house services and features. Both companies provide basic credit card processing services and a range of hardware options for accepting payments.
Square is best known for its mobile processing system, which combines a tablet/smartphone app with a small card reader to offer the same transaction processing capability as a traditional countertop credit card terminal. QuickBooks has a similar system called QuickBooks GoPayment.
What Does Square Include?
Square stands apart from most traditional providers in that it has always been primarily focused on meeting the needs of small and newly established businesses. Initially, the company only offered a bare-bones mobile processing system that provided basic credit and debit card processing functions and little else. However, that’s no longer the case. Merchants signing up for Square today will discover a broad range of products and services that goes way beyond just credit card processing. Even with a free account, you’ll have access to all of the following features:
- Credit and debit card payment processing
- Support for in-person, online, and keyed-in transactions
- Square Point of Sale app (free)
- Square Reader for magstripe (free, also included with the Contactless & Chip reader)
- Square Invoices
- Installment payments
- Square Appointments (free for one user)
- Square Inventory
- Access to Square Dashboard
- Access to Square Online Store (includes a payment gateway, virtual terminal, online shopping cart functions)
- Ancillary services, such as a customer information database, gift card programs, and more
Square also offers paid products and features that you may need to add to your account if you want to take full advantage of Square’s growing business ecosystem. Highlights include the following:
- Square Reader for Contactless & Chip ($49, accepts EMV and NFC-based payments)
- Square Payroll (starts at $5/month per person)
- Square for Retail (starts at $60/month)
- Square for Restaurants (starts at $60/month per location)
What Does QuickBooks Include?
While QuickBooks is best known as an industry-leading small business accounting software package, Intuit also offers QuickBooks Payments for users who also need a merchant account for credit card processing. Like most merchant services providers, QuickBooks Payments includes a variety of products and services to help you run your business, including the following:
- Credit and debit card payment processing
- Support for in-person, online, and keyed-in transactions
- QuickBooks GoPayment mobile processing app + compatible card reader ($19-$49 each)
- QuickBooks Invoicing
While this feature list is pretty basic, it’s more than adequate to meet the needs of many small business owners. Remember also that QuickBooks Payments doesn’t require a monthly fee, although you will need a paid QuickBooks subscription to use it. Expanded capabilities are available, but they can be pretty expensive. For example, the QuickBooks Point of Sale software package starts at $1,200 for the basic version. QuickBooks Payroll is somewhat more reasonable, starting at $45/month + $4/month per employee.
The Key Differences Between Square & QuickBooks Payments
Both Square and QuickBooks Payments offer a basic, low-cost solution that will allow you to accept credit and debit cards and keep tabs on your business. One major difference between these two providers is that QuickBooks Payments offers a full-service merchant account rather than the aggregated accounts available with Square. While merchant accounts require more time and paperwork to set up, they provide better account stability than aggregated accounts. That means you’re far less likely to have your account suddenly frozen or shut down than you are with a payment service provider such as Square.
Both providers also have other differences in the products and services they offer. For the most part, Square offers proprietary services that can only be used with a Square account. QuickBooks Payments, on the other hand, places a little more emphasis on integration with services from third-party providers. Here’s a summary of the main differences between Square and QuickBooks Payments:
|Type Of Payment Processor||Payment Service Provider (PSP)||Merchant Account Provider (MAP)|
|Account Type||An aggregated account with no Merchant ID#; requires a minimal underwriting process||A full-service merchant account with a unique Merchant ID#; requires an extensive underwriting process|
|Scope Of Software||Full support for retail or eCommerce businesses||Full support for retail businesses; eCommerce requires either Square POS ($1,200+) or third-party product|
|Monthly Fee||$0.00/month for a basic account||$0.00/month or $20.00/month for a basic account|
|Free Credit Card Reader||Magstripe-only||Not offered|
On the surface, the type of payment account offered is one of the few major differences between Square and QuickBooks Payments. In other respects, they’re remarkably similar. Both offer true month-to-month billing with no long-term commitment, predictable flat-rate pricing, and a basic account that comes with no monthly fees. Both allow you to accept credit and debit cards from all of the major credit card brands and support magstripe, EMV, and NFC-based (contactless) payment methods, such as Apple Pay and Google Pay.
One important difference, however, is that QuickBooks Payments does not support cash payments. While you can still accept them, you’ll have to enter each transaction manually for bookkeeping purposes.
QuickBooks VS Square Rates & Fees
Square’s flat-rate pricing, lack of monthly fees, and focus on mobile payments have spawned many competitors. Several of these competitors now offer nearly identical processing rate plans and limited fee schedules to better market their services to the long-neglected small business community. QuickBooks Payments is clearly one of those competitors. The similarities between QuickBooks vs. Square are more numerous than the differences that set both companies apart from each other.
One significant difference that we’re going to mention first is that while QuickBooks Payments vs. Square offers pricing plans that do not include a monthly account fee, you will still have to have an active QuickBooks Online subscription to use its payment service. These subscriptions start at $25 per month, making QuickBooks a less appealing option for seasonal businesses or those that only occasionally process a credit card transaction.
While Square’s flat-rate processing fees have gotten a little more complicated over the years as the company has added on numerous options and features, it’s still pretty simple. Here are the rates you need to know:
- 2.6% + $0.10 per swiped, dipped, or tapped transaction
- 2.9% + $0.30 per online transaction (including invoices)
- 3.5% + $0.15 per manually keyed-in or card-on-file transaction
Unless you sign up for one of Square’s paid add-on services, there is no monthly account fee. Square also doesn’t charge for PCI compliance and is just about the only provider we’re aware of that doesn’t impose a chargeback fee. While you can still get a free magstripe-only reader with your account, we highly recommend that you at least purchase the $49 Square Reader for Contactless + Chip to ensure EMV compatibility. For a more in-depth look at Square’s full pricing schedule, check out our article, The Complete Guide To Square Costs For Payment Processing & Software.
QuickBooks Payments Pricing
Like Square, QuickBooks Payments also relies on flat-rate pricing to keep things simple and predictable. However, it uses a more complicated rate schedule than Square, depending on which QuickBooks service you’re using and whether you’ve opted for a pay-as-you-go plan or a monthly subscription plan. Rates for users of QuickBooks Online or the GoPayment mobile app are as follows:
- Swiped/Dipped/Tapped: 2.4% + $0.25 per transaction
- Invoice Payments (Includes PayPal & Apple Pay): 2.9% + $0.25 per transaction
- Manually Keyed-In: 3.4% + $0.25 per transaction
These rates are very similar to what Square charges, although the hefty $0.25 per transaction authorization fee will make QuickBooks Payments more expensive if you process a lot of small-ticket transactions. You can choose between the standard, pay-as-you-go plan ($0.00 per month) or the $20/month subscription plan, which offers slightly lower processing rates than those listed above.
PCI compliance is an optional add-on under the pay-as-you-go plan ($9.95/month) but is included as part of your monthly fee under the subscription plan. QuickBooks Payments also charges several incidental fees, including a $25 chargeback fee, a $25 ACH/bank reject fee, and a $10 returned check fee. For more detailed pricing information, please check out the following articles:
- The Complete Guide To QuickBooks Online Pricing
- How Much Is QBO Payroll? The Complete Guide To QuickBooks Online Payroll Pricing
Which Is Cheaper, Square or QuickBooks?
Neither Square nor QuickBooks Payments emerge as a clear winner in terms of affordability. While both companies offer a similar flat-rate pricing structure with minimal recurring fees, numerous add-ons and optional features can significantly raise the overall price tag. Square generally charges a slightly higher percentage processing fee but a lower per-transaction authorization fee.
All other things being equal, Square will be a little less expensive for businesses with a lower average ticket size, while QuickBooks Payments should be more affordable for those with a high average ticket size. In comparing the two companies’ pricing plans against your current business data, be sure to include the cost of any optional add-on features you’re going to need.
QuickBooks Payments VS Square: Comparing Core Features & Services
|Payment Processing||Accepts all major credit/debit cards; supports magstripe/EMV/NFC & online payments, ACH transfers; supports pay by email, SMS, payment button, QR code||Accepts all major credit/debit cards; supports magstripe/EMV/NFC & online payments; includes ACH bank transfers|
|Mobile Processing App||Square Point of Sale: accepts card-present, keyed-in, card on file; receipts via SMS/email; incudes inventory management, employee management, etc.||QuickBooks GoPayment: accepts card-present, keyed-in, card on file; receipts via SMS/email|
|Card Reader||Square Reader for contactless and chip: Accepts EMV & NFC-based payments; $49 each; includes backup magstripe reader||QuickBooks Card Reader: Accepts EMV, Apple Pay, Google Pay; $49 ($39 optional stand or $79 bundled with Reader)|
|Invoicing||Available with Square account; no additional cost; accepts credit/debit card or ACH transfer; supports recurring billing & installment payments||Available with QuickBooks Online subscription; accepts credit/debit card or ACH transfer; supports recurring billing & progressive invoicing|
|Payroll||Square Payroll: $29/month + $5/month per employee; pay via direct deposit or cash card, tax calculation & filing, etc.||Core Plan: $45/month + $4/month per employee; offers next-day deposit, tax calculation & filing, etc.|
|Access To Funds||1-2 business days, or same day (for 1.5% fee)||2-3 business days|
Both Square and QuickBooks Payments offer a wide range of features designed specifically to meet the needs of most small business owners. In terms of basic payment processing functionality, there isn’t really a significant difference between the two providers. However, when it comes to all of the additional services you’ll need to run your business effectively, there are some differences that make one provider a better choice if you need that specific service. We should also point out that because both companies are focusing on the small business sector, you may find that some services are a little too basic. The limited customization options, for example, is a common complaint against both companies’ invoicing features.
You should also note that, unlike many traditional merchant account providers, Square and QuickBooks both tend to take a “walled garden” approach toward building their small business ecosystem of products and services. In other words, it’s usually not possible to bring in a third-party product or service and integrate it with your Square or QuickBooks account. Likewise, both companies generally offer proprietary products that can’t be used with other providers. The one exception to this rule is in the area of accounting software. Square does not offer its own accounting product but can be integrated with either QuickBooks or Xero. QuickBooks, on the other hand, can be integrated with virtually any provider on the market.
Here’s a more detailed look at how the core features of Square and QuickBooks stack up against each other:
Square & QuickBooks Integrations
As we’ve noted above, both Square and QuickBooks offer mainly proprietary products that are designed to work together seamlessly but don’t allow for much in the way of third-party integrations. There are important exceptions, however.
Square doesn’t offer its own accounting software, but it does integrate with both QuickBooks and Xero. Here, the company basically acknowledges the reality that QuickBooks has an insurmountable lead in terms of market share, and it’s unlikely that many existing Square users would want to give it up for a proprietary QuickBooks product. The only downside to using QuickBooks for your bookkeeping and Square for payments is that it introduces a monthly fee into Square’s pay-as-you-go pricing model. Doing so might not be a good choice for a seasonal business or one that’s looking to keep operating expenses to an absolute minimum.
QuickBooks Payments also prefers to keep everything in-house as much as possible, with very little in the way of third-party integrations. The main exception is eCommerce, which has never been the company’s strongest area. For optimal QuickBooks integration, you can choose either BigCommerce or Shopify. Support for UltraCart and WooCommerce is also available but may not be quite as seamless.
Which Is Best For My Business Needs: QuickBooks Payments Or Square?
Square has been the provider of choice for many small businesses in recent years, and with its ever-expanding lineup of services, it’s very close to being a one-stop shop for all your business needs. This success has drawn a lot of competitors, most of which have never been willing to break completely free of the processing industry’s bad habits. QuickBooks Payments, in contrast, is actually a worthy alternative to Square and may, in fact, be the better option in some cases. Here are some guidelines to consider in choosing between these two platforms:
Choose Square If…
- You already have a Square account and are satisfied with its pricing and features
- You run a seasonal business and don’t want to pay any fees during your downtime
- You run a small online business and don’t need a fancy eCommerce platform
- You’re in retail and need a strong inventory management system
- You’re in the restaurant business
Choose QuickBooks Payments If…
- You already use QuickBooks and want to add credit card processing without additional fees
- You want a stable, full-service merchant account
- You want all of your merchant services to integrate with QuickBooks Online seamlessly
- You’re in a professional services industry and collect most payments through invoices
- You process over $7,500 per month and want to negotiate a custom processing rate plan
QuickBooks VS Square Comparison: The Final Verdict
Square and QuickBooks are two of the most recognizable names in the payments industry. While Square is known mostly for opening up credit card acceptance to thousands of small businesses that previously couldn’t afford it, QuickBooks has been one of the most popular small business accounting services in the industry for decades.
QuickBooks is the clear winner for your bookkeeping needs, with Square not even trying to offer a competing service. In fact, many business owners will find that using QuickBooks for accounting and Square for credit card processing and everything else will be a winning combination. At the same time, there are distinct advantages to having a full-service merchant account, and QuickBooks Payments is one of the very few providers that offer one with no monthly fee or long-term commitment.
At the same time, eCommerce is clearly QuickBooks’ Achilles heel, and it seems very well aware that most small business owners are not going to shell out $1,200 or more for its QuickBooks Point of Sale software package. While it’s true that the monthly fees for Shopify or BigCommerce will add up to more than this amount after a few years, both of these platforms offer more features and are constantly being upgraded to introduce new capabilities and integrations.
With both contenders offering minimal fees and nearly identical flat-rate pricing, most businesses won’t see a significant overall price difference between them. Whether Square or QuickBooks will be the better choice will mainly come down to which of the two companies offers the better features your business needs to grow and thrive. Good luck!