Zettle has been rebranded as PayPal POS, though the Zettle name persists widely and the hardware hasn’t changed. It and Square are the two most closely matched card readers available to UK small businesses. Same 1.75% in-person rate. Both no-contract, pay-as-you-go, phone-paired, with free apps: on paper they’re nearly identical. In practice, the differences are significant enough that you should be able to make the decision on which choose for your business.
| Square | Zettle | |
|---|---|---|
| In-person rate | 1.75% | 1.75% |
| Invoice rate | 2.5% + 25p | 1.75% + 25p |
| Online rate | 1.4% + 25p | PayPal rates |
| Manual entry rate | 2.5% | 3.49% + 50p |
| Entry reader price | £19 + VAT | £29 + VAT (1st), £69 + VAT (subsequent) |
| Settlement | 1–2 days to bank | Minutes to PayPal, 1–2 days to bank |
| Chargeback protection | None | Up to £250/month |
| Refunds fee back? | Yes | No |
| POS software | Strong | Basic |
| Online store | Yes (Square Online) | No native option |
| Hardware warranty | 2 years | 1 year |
Fees
In-person payments: both charge 1.75% for contactless, chip and PIN, Apple Pay, and Google Pay.
Invoicing: Zettle charges 1.75% + 25p per invoice payment. Square charges 2.5% + 25p. On a £500 invoice, Zettle takes £9 versus Square’s £12.75. If you send invoices regularly, that adds up.
Online payments: Square charges 1.4% + 25p for payments through Square Online. Zettle doesn’t have a native online store, so online sales go through PayPal Checkout, which operates on PayPal’s own (typically higher) rates.
Manual card entry: Zettle charges 3.49% + 50p. Square charges 2.5%. If you occasionally key in card details for phone orders, Square is cheaper.
Refunds: Square refunds its transaction fee when you process a refund. Zettle doesn’t.
The net picture on fees: both cost the same for the majority of transactions (in-person contactless). Zettle wins on invoicing. Square wins on online payments, manual entry, and refunds. If most of your sales are face-to-face with a card present, they’re essentially tied.
Hardware
Zettle: the Reader 2 costs £29 + VAT for the first reader, and £69 + VAT for each subsequent one. It’s slightly heavier and more solid-feeling than the Square Reader, with an IP21 rating offering minor splash resistance. Battery lasts around 8 hours. Zettle also makes a Terminal (£199 + VAT) with a screen and printer.
The escalating price for additional readers is a real practical problem. Equipping two or three staff members costs significantly more with Zettle than Square. At £69 per extra reader versus £19 for Square Reader 2, the hardware cost difference is hard to ignore once you’re beyond a single-person operation.
Square: the Reader 2 is £19 + VAT, notably cheaper and lighter. The Terminal (£149 + VAT) is a proper counter device with a customer-facing display. The Register (£599 + VAT) adds a full dual-screen POS setup. Square has more hardware options at each price point, and a two-year warranty versus Zettle’s one year.
The verdict on hardware: Square is cheaper upfront and meaningfully cheaper when equipping multiple staff. The only hardware advantage Zettle has is the slightly more robust Reader 2 and its IP21 rating for light outdoor use.
Software
Square’s free POS app is comprehensive: item catalogues with images and modifiers, inventory management with stock alerts, staff accounts and permissions, detailed sales reports, tipping, loyalty, gift cards, appointment booking (Square Appointments), and a free online store (Square Online). It covers most of what a small retail or hospitality business needs without a monthly fee.
Zettle’s app handles payments, a basic product library, and sales reports. It integrates natively with PayPal, settling into your PayPal account. Integrations with QuickBooks, Xero, and some third-party EPOS systems are available, but for inventory management or staff tracking beyond basics you’ll need to look elsewhere.
The verdict on software: Square is materially better. The only reason to prefer Zettle’s software is if deep PayPal integration matters — for instance, if most of your transactions come through PayPal online and you want one ecosystem for everything.
Settlement
Square: one to two business days to your bank account. Instant transfer to a linked debit card for a 1.5% fee.
Zettle: settles to your PayPal account within minutes. Moving from PayPal to your bank takes one to two business days. If you already use PayPal actively, the instant PayPal balance is genuinely useful. If you don’t, it’s just an extra step.
The verdict on settlement: roughly equal to your bank account. Zettle is faster if you spend from PayPal regularly; Square is faster if you want money in your bank without stopping at PayPal first.
Chargeback protection
This is one area where Zettle has a concrete advantage. Zettle offers up to £250/month in chargeback protection on eligible transactions — if a customer disputes a payment and wins, Zettle absorbs the cost up to that limit. Square handles chargebacks on your behalf but offers no financial protection against losses.
For a business taking a lot of face-to-face payments from new or one-off customers — events, markets, tourist-facing businesses — that £250/month protection has real value.
Who should choose Square
Square suits you if you want an online store alongside your card reader. If you’re equipping multiple staff members — cheaper per additional reader by a significant margin. If you issue refunds frequently and want the fee returned. If you want staff accounts, inventory management, or appointments on the free plan. If a two-year hardware warranty matters. If you occasionally take payments over the phone (lower manual entry rate).
Who should choose Zettle by PayPal
Zettle suits you if you already use PayPal heavily and want settlement into your PayPal balance quickly. If you send invoices regularly and want the lower 1.75% + 25p rate. If the £250/month chargeback protection matters for your business model. If you need a reader that’s slightly more robust for outdoor use. If you’re a simple business that doesn’t need advanced POS features and the PayPal ecosystem works for you.
Making the choice
For most UK small businesses: Square. Better online rates, better software, cheaper hardware when equipping multiple staff, fee refunds on returns, and a longer warranty. The gap in overall capability is real.
Zettle makes more sense if your business already runs on PayPal — selling through eBay, Etsy with PayPal checkout, or with a customer base that pays via PayPal online. The instant PayPal settlement, lower invoice fees, and chargeback protection are all genuine advantages in that specific context.
See our guide to best card readers for small businesses for the full picture, or our guide to choosing a card reader for help deciding what fits.
