Square vs. Shopify: Which Is Right for Your Business?

Square offers flexible options, but Shopify is geared toward e-commerce sales.

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Square and Shopify offer payment processing services that support in-person and online sales and include point-of-sale, or POS, software features. The main differences between Square and Shopify are pricing, contract requirements and features. Although Shopify might be better suited for focusing on e-commerce sales, Square offers more flexibility.

Here's how they compare.

Deciding factors

Square

Shopify

Software cost

Free with add-ons. Basic POS is free with ability to add paid features or plans.

Varies. Plans start at $9 per month with features depending on chosen plan.

Hardware cost

Varies. Price depends on the chosen model.

  • $49 for Chipper 2X BT card reader or Tap & Chip card reader.

  • $219 for Retail Kit.

  • $399 for Shopify POS Go mobile device ($429 with case).

Payment processing cost

  • 2.6% plus 10 cents for in-person transactions (2.5% plus 10 cents with Retail Plus plan).

  • 2.9% plus 30 cents for online transactions or invoices without a card on file (2.6% plus 30 cents with Premium plan).

  • 3.5% plus 15 cents for manually keyed transactions or card-on-file invoices.

  • 2.4%, 2.6% or 2.9% plus 30 cents for online payments for Advanced, Shopify or Basic plan, respectively.

  • 2.4%, 2.5% or 2.7% for in-person payments for Advanced, Shopify or Basic plan, respectively.

  • $29 per month for Basic, $79 per month for Shopify or $299 per month for Advanced plan.

Contract length

None. Square doesn't require a contract.

Varies. All plans are month-to-month agreements with long-term options available.

Live support

Yes. Support is available by phone, email, live chat and social media.

Yes. Support is available by phone, chat and email.

Ease of use

Easy. Square is easy to set up and use for in-person and online transactions.

Easy. Shopify is simple to use and lets you grow with its services.

Pros

Square

  • More robust POS features. Because Square doesn't determine which features you can use based on a chosen plan, it offers more robust POS features for free.

  • More card reader options. Square offers five card reader options to fit different business needs, so you're more likely to find what you want out of a reader.

  • No monthly fee. By only charging processing fees, Square is likely to be the cheaper option for many businesses.

Square
Shop Now

on Square's website

Shopify

  • An online store is available in all plans. Shopify includes features for online stores in every plan, so you don't have to worry about paying extra for that option.

  • Scalable plans. With multiple plan options, owners can scale their businesses without worrying about losing the features they need. They can move up to the next plan to take advantage of more features.

  • Cheaper processing rates are available. For example, Shopify's more expensive plans come with cheaper processing rates to save businesses money if they need the full gamut of features.

Shopify Retail POS

Shopify
NerdWallet rating 
Shop Now

on Shopify's website

Cons

Square

  • Extra cost for online store features. Square requires businesses to choose a plan to use their online store options. There is a free plan, but the features are limited.

Shopify

  • Variable processing fees. Not all businesses pay the same processing fees, meaning companies that can pay for more expensive plans will pay less per transaction.

Square features

Square software

Square's POS lets you accept all major credit cards and digital wallets, including Apple Pay, Google Pay and Samsung Pay. Moreover, there is no monthly fee or a required contract. Instead, Square charges a processing fee for every transaction, and the rate depends on the type of transaction.

Square offers transparent pricing and only charges your business when you make a transaction. Its rates are broken down into categories:

  • 2.6% plus 10 cents for in-person transactions (2.5% plus 10 cents with Retail Plus plan).

  • 2.9% plus 30 cents for online transactions or invoices without a card on file (2.6% plus 30 cents with Premium plan).

  • 3.5% plus 15 cents for manually keyed transactions or card-on-file invoices.

Square hosts a cloud-based POS system, which means all its features are accessible anywhere with an internet connection. You can sign into the POS system from any device, including an iOS and Android smartphone.

Many of Square's POS features are free, but the price of POS add-ons depend on the chosen feature and plan. The more a feature is used, the higher the monthly charge.

  • Loyalty rewards. Plans range from $45-$105 per month per location. Create a custom loyalty program to reward repeat customers.

  • Email marketing. Plans range from $15-$35 per month. Create custom emails and track how customers interact with them.

  • Payroll management. For the contractors-only plan, it's $5 per month per contractor. The plan for contractors and employees is $35 per month plus $5 per month for each person being paid. Payroll management allows you to track employees' hours, process payroll, file taxes and more.

Square's POS offers free features, such as reporting, team management and inventory management. Some of these features are all-inclusive, while others have paid plans that provide more flexibility. With the free features, you can:

  • Accept and track transactions.

  • Process payments in offline mode.

  • Send email or SMS receipts or print receipts with available printers.

  • Create discounts and limited-time offers.

  • Keep track of customers in a directory.

  • Accept online transactions with e-commerce stores.

  • Customize and export sales reports.

  • Manage inventory with stock alerts and integration options.

  • Utilize third-party app integrations like QuickBooks and Wix.

Square
Shop Now

on Square's website

Square e-commerce

Square offers website hosting so you can set up a website and sell your products and services while using Square to process payments.

Square's website plans include a tiered pricing structure that adds features onto each tier — so the more you pay, the more you get. The Square Online plans charge a monthly fee and include a free option.

Here are the prices for Square's four website plans:

  • Free. $0 per month and 2.9% plus 30 cents per transaction.

  • Professional. $12 per month and 2.9% plus 30 cents per transaction.

  • Performance. $26 per month and 2.9% plus 30 cents per transaction.

  • Premium. $72 per month and 2.6% plus 30 cents per transaction.

Square Online uses a website builder that doesn't require coding experience, and businesses can even connect with platforms like Instagram to sell their products on social media. It also allows customers to choose a buy-now-pay-later option when checking out on websites.

Square hardware

Square offers five credit card readers that vary in their capabilities and are available for all sizes of businesses and budgets, including:

  • Reader for magstripe. Free with sign-up and $10 for each additional reader.

  • Reader for contactless and chip. $49.

  • Square Stand. $169.

  • Square Terminal. $299.

  • Square Register. $799.

Each works with its free POS software, but they differ in which types of credit cards they accept, handheld or countertop design and which features they include:

  • Reader for magstripe. This reader only swipes magstripe credit cards and connects to a smartphone through a headphone jack or Lightning port. It requires you to use the Square App to process payments and doesn't need to be charged.

  • Reader for contactless and chip. This reader only accepts chipped credit cards, contactless payments and digital wallets. It connects to a smart device by Bluetooth and uses the Square App to run transactions. Square also offers Tap to Pay on iPhone, which lets merchants accept card payments using only a regular iPhone with the Square POS app. Customers hold their cards or their own iPhone wallets near the merchant's phone to pay.

  • Square Stand. Connecting a tablet with the contactless and chip reader lets this system accept all types of credit cards along with scanning QR codes with the Square Cash App. It also swivels to allow customers to use the screen and can be mounted onto a counter.

  • Square Terminal. As a handheld design with a countertop dock, this model accepts all credit cards and digital wallets. In addition, it prints receipts and can be connected to a tablet for a second screen.

  • Square Register. This reader offers two screens so customers can see transaction details and accepts all payment types, including QR codes with the Cash App. It mounts onto a countertop for a complete register experience, but it doesn't print receipts or scan barcodes on its own.

Shopify features

Shopify software

Shopify has five POS and payment processing plans tiered like Square's pricing structure. The more the monthly cost, the more you'll get. Here are the available plan prices:

  • Shopify Lite. $9 per month and rates starting at 2.7% per transaction.

  • Basic. $29 per month and rates starting at 2.7% per transaction.

  • Shopify. $79 per month and rates starting at 2.5% per transaction.

  • Advanced. $299 per month and rates starting at 2.4% per transaction.

  • Shopify Plus. $2,000 per month with a quote-based processing rate.

Like Square's POS, Shopify's cloud-based POS system lets businesses access their dashboard via smart devices as well as a desktop computer. You can sign in to the POS system on iOS and Android smartphones.

Shopify doesn't offer free POS features, but its base plan, called Shopify Lite, provides the following features:

  • Add the "Buy" button to your website to sell through your Shopify Payments plan.

  • Accept credit card and digital wallet payments on the go and in person.

  • Create invoices to send to customers and get paid by email.

  • See financial reports.

  • Create customer profiles

  • Manage orders and products for limited inventory.

  • QR code details for products.

  • Issue gift cards.

  • Split customer bills.

  • Create customer discounts.

Among Shopify's other paid plans, additional features include capabilities to:

  • Schedule local pickup and delivery.

  • Create purchase orders.

  • Receive low stock alerts.

  • Run an analysis of inventory and create detailed inventory reports.

  • Require manager approvals and create staff permissions depending on their roles.

  • Create custom-printed receipts.

  • Run daily sales reports.

Shopify e-commerce

Shopify includes e-commerce features in every plan, so there is no additional cost for an online store. Shopify Online Store lets you build a customized website. Like Square, it uses a simple builder that doesn't require coding. Customers can pay online, and transactions are processed through Shopify Payments. And businesses can integrate their online store with over 6,000 apps, including social media platforms, to boost their sales.

Shopify hardware

  • Chipper 2X BT Reader. This reader is compact and lets you tap, insert and swipe credit or debit cards. It also accepts Apple Pay and Google Pay. Because it connects to a smart device through Bluetooth, you'll need a compatible iPhone or iPad to run transactions. This model is not compatible with Android devices. You also need Shopify Payments enabled to accept payment cards with this device.

  • Retail Kit. This iPad stand and card reader combo accepts chip and contactless payments is a countertop system that runs $219.

  • POS Go. This handheld mobile device has a card reader and barcode scanner. The case provides protection and a hand strap. It runs $399 ($429 with the case).

  • Tap to pay on iPhone. This is a payment acceptance capability that allows businesses on Shopify POS to accept contactless payments directly on an iPhone. This is currently built into Shopify POS software. It does not work on iPads.

Which is right for you?

If you want more POS features and credit card reader options and aren't concerned about having a lot of flexibility to build an online store, Square might be the best option for you. But if you want to focus on e-commerce sales and add more features as your business grows, you might want to go with Shopify.

Other POS systems to consider

Clover

Pricing:

  • 2.3% plus 10 cents for in-person transactions for most plans.

  • 2.6% plus 10 cents for in-person transactions on Retail Starter, Personal Services Starter and Professional Services Standard plans, as well as Home & Field Services Standard and Advanced plans.

  • 3.5% plus 10 cents for online or keyed-in transactions.

Why we like it: Clover accepts credit cards and contactless payments and offers small businesses a variety of card reader options for every budget, including the handheld Clover Go for $49 and the countertop Clover Station Duo with two screens for $1,649. You can integrate Clover into your existing website or work with Clover to build a new one for online sales. Its POS includes business-driven features, such as sales tracking and reporting, inventory and order management and a web-based dashboard. While it has a free plan available, businesses will need to choose a paid monthly plan for better features.

Clover

Clover
NerdWallet rating 
Shop Now

on Clover's website

Stripe

Pricing:

  • 2.9% plus 30 cents for online transactions.

  • 2.7% plus 5 cents for in-person transactions.

  • 3.4% plus 30 cents for manually keyed transactions (starting 11/10/22).

  • 3.9% plus 30 cents for international cards or currency conversion.

Why we like it: Stripe offers online and in-person payment processing and has hosted checkout to make the e-commerce experience more flexible. It also lets you set up recurring billing and send invoices. It has one proprietary card reader but works with two other models to give you flexibility, with prices starting at $59. Stripe's POS is limited compared to competitors, but it offers small businesses reporting features, QuickBooks integration, 24/7 support and a Developers Dashboard for customizations.

Stripe

Stripe
NerdWallet rating 
Shop Now

on Stripe's website

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