Square Rates
Updated: October 26, 2026
Reps will receive two different sign up links: one with Rack Rate (2.6% + $0.15) and one with the 4% Flat Rate.
Make sure you do not pick the wrong one when signing up a merchant!
Understanding Rates: 4% Flat Rate vs. 2.6% + $0.15
Square merchants can be set up on one of two rates: the 4% Flat Rate (or custom rate, see below instructions) or the Rack Rate of 2.6% + $0.15 per transaction.
At Equip, we encourage reps to lead with the 4% Flat Rate and show merchants how to pass the fee to their customers. With a small service adjustment at checkout, merchants can offset nearly 100% of their processing costs, so the rate has little to no impact on their bottom line. It's simple, predictable, and easy to explain, and it's also the most profitable setup for you!
Understanding Effective Rates
A merchant's effective rate is what they actually pay as a percentage of each sale once every fee is included. On the 4% Flat Rate, the effective rate is always 4%.
On 2.6% + $0.15, the 15-cent transaction fee carries more weight as the ticket gets smaller:
Avg. ticket Effective rate on 2.6% + $0.15:
$5 avg ticket - 5.60%
$10 avg ticket - 4.10%
$20 avg ticket - 3.35%
$50 avg ticket - 2.90%
$100 avg ticket - 2.75%
The break-even point is about $10.71. Below that average ticket, 2.6% + $0.15 actually costs the merchant more than the 4% Flat Rate, even though it looks lower on paper. A coffee shop, smoothie bar, or food truck with $6 to $9 tickets would pay a higher effective rate on the "lower" plan.
THIS IS KEY: Regardless of which rate setup, merchants pay only their processing rate and software plan: no annual, PCI, statement or security fees.
How to Request Custom Pricing
Here is how to request custom pricing, which is anything other than the rack rate or 4% flat rate, i.e. 3.75% flat rate).
- Board the merchant at the Rack Rate or 4% Flat Rate first. This creates their merchant token.
- Email Tyisha (tyisha@equippaymentsolutions.com) and cc Angela (angela@equippaymentsolutions.com) with: business name, Square account email, monthly processing volume (GPV), average ticket, card-present vs. card-not-present split, and requested pricing (for interchange +, note daily or monthly billing).
- Square Finance sends the pricing addendum to the merchant to sign. You'll be copied.
- Pricing updates within 2 to 3 business days after the merchant signs.
Custom pricing is anything other than the Rack Rate or the 4% Flat Rate. It requires at least $250,000 in annual processing volume.
Offsetting Processing Costs / Passing the Fee (see the next page)
These are set in the merchant's Square Dashboard, separate from the processing rate, so make sure the rate you set matches the offset option they choose.
