Square vs. FreshBooks: Card Readers

***Update 2023: FreshBooks no longer offers a card reader itself, instead suggesting other brands. We’re leaving this article for historical purposes, but businesses looking for a smartphone card reader should consider current options. Check out CardFellow’s equipment directory for assistance.

FreshBooks started as accounting software, a rival to Intuit’s popular QuickBooks brand. In 2016, FreshBooks rolled out a smartphone credit card reader to allow customers to take payments in addition to managing financial information.

How do Square and FreshBooks stack up? Let’s take a look.

Costs for Accepting Cards

In the battle of Square vs. FreshBooks, pricing is similar, but Square has an edge. Both companies offer flat rate pricing to accept credit cards. Until recently, Square didn’t charge a per-transaction fee, but now does for businesses with average tickets under $10.

Square charges 2.6% + $0.10 for swiped transactions.

This is compared to FreshBooks’ 2.7% + $0.30. That 30 cents can add up quickly if you process a lot of transactions.

For American Express, Square comes out ahead again, charging the same 2.75% (possibly with a $0.10 – $0.15 charge for small transactions) while FreshBooks comes in at 3.4% + $0.30. And finally, when keying in cards instead of swiping, Square offers 3.5% + $0.15 to FreshBooks’ 3.5% + $0.30.

Square vs FreshBooks costs

Note that for businesses processing transactions under $10, Square may impose a per-transaction fee of 10-15 cents.

Remember that while flat rate pricing makes your costs look simpler, it’s not necessarily the lowest it could be. Square is the winner between the two, but it doesn’t mean it’s the cheapest mobile payment option overall.

Winner: Square.

Card Readers

For equipment, Square offers a choice of three credit card readers: the original magnetic stripe headphone jack reader, a combination magstripe/EMV headphone jack reader, and a countertop EMV/NFC reader.

FreshBooks currently only offers one reader, a combination magstripe/EMV headphone jack reader. If accepting NFC technologies like Apple Pay is important to you, Square is the better option of the two.

Square and FreshBooks reader operating systems

While previously only available for Apple devices, FreshBooks released a reader for Android in May 2016, meaning both options work with either Apple or Android systems.

Winner: Square

Customer Service

On customer service, the internet has spoken: FreshBooks has knowledgeable representatives that can be reached by phone. Square doesn’t provide a customer service phone number, and clients repeatedly take to review sites and the Better Business Bureau to express frustration with Square’s ongoing support. (Or lack of.) If being able to reach customer service is important to you, Square might not be the best choice.

Winner: FreshBooks.

CardFellow’s Experience

We’ve had the opportunity to test out both the FreshBooks reader and payment app, and the Square reader and register app. While both offer similar functions, the FreshBooks reader is more user-friendly, featuring screens that guide you through the process of accepting a card if you need assistance.

As seen the screenshots, below, opening the FreshBooks app will display a menu that allows you to choose what you want to do. Opening the Square app drops you directly into the payment entry screen.

FreshBooks main screen       Square screenshot

Both card readers we tested were headphone jack models. We used the same phone each time, and found that both the Square and FreshBooks readers are stable. The FreshBooks reader is a little easier to swipe a card through since it’s larger, but neither presented a huge advantage.

Square reader          FreshBooks reader

The Square reader is noticeably smaller, with the main part approximately the size of a quarter. The FreshBooks reader is approximately 2.5 inches long by 2 inches wide. (Images not to scale.)

So should I use Square or FreshBooks?

If you’re choosing just between the two, and cost is your most important factor, you’ll likely want to go with Square. However, as noted, if customer service is important to you, FreshBooks may be a better fit.

But if you’re not set on using one of these two, there are more options. Many traditional credit card processing companies now offer smartphone and tablet processing, and it may even cost less. If you’re interested in seeing what else is out there, browse through our reviews of smartphone card readers.


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