Pay-as-you-go vs Monthly Contract Card Machines
Find the sales level at which a lower transaction rate pays for a subscription, then check the exceptions.
The short answer
Pay-as-you-go can suit low or irregular use because fixed charges may be lower. A monthly package can become cheaper when eligible transaction savings exceed its extra fixed costs. The crossover depends on card mix, average payment size, equipment and contract terms, not turnover alone.
In this guide
What changes between the two models?
“Pay-as-you-go” usually describes how processing is charged, not a promise that every associated service is free. Confirm hardware, online payments, optional software and other charges. A monthly agreement may offer a lower transaction price while adding a fixed payment or commitment.
Compare the same equipment and functions. If one subscription includes EPOS software you would otherwise buy, count that difference once. If it includes features you do not need, do not assign them an invented saving.
Record what happens in a month with no sales: which subscriptions, rental charges, minimums and service fees still remain?
Calculate a simple subscription crossover
Plan A charges 1.6% with no monthly fee. Plan B charges 1.0% plus £20 a month. Assume no pence fees, equipment differences, minimums or other charges.
Crossover sales = £20 ÷ (0.016 − 0.010) = £3,333.33 per month
| Monthly card sales | Plan A | Plan B |
|---|---|---|
| £2,000 | £32 | £40 |
| £5,000 | £80 | £70 |
| £10,000 | £160 | £120 |
Below the crossover, A costs less under these assumptions. Above it, B costs less. This is a monthly subscription threshold, not the break-even date after paying switching costs.
Why average payment size changes the result
Suppose fictional Plan B also charges 4p per payment. At an average payment of £10, that adds 0.4% of sales. Its variable cost becomes 1.4%, so the difference from Plan A is only 0.2 percentage points. The £20 subscription now requires £10,000 monthly sales to break even.
At an average payment of £50, the same 4p is 0.08% of sales. This is why a café making many small sales and a retailer making fewer large sales should not use the same turnover-only comparison.
Use the actual payment count where available. If charges apply to authorisations or other events rather than successful payments, confirm the count used.
Apply the discount only to eligible sales
A provider may reduce the price for some cards or channels while leaving others unchanged. As checked on 15 October 2026, SumUp’s Payments Plus page lists a £19 monthly or £189 annual subscription and distinguishes its 0.99% eligible in-person domestic consumer-card fee from 1.69% for international, corporate and premium cards, including American Express. Its listed online fee is separate.
That is a published example of an eligibility condition, not a recommendation or a complete package quotation. Check the current source and your agreement before calculating. Do not apply a qualifying-card discount to all your turnover if part of it receives a different price.
Allow for quiet months and commitments
List at least an ordinary month, a busy month and a quiet month. A fixed subscription can be attractive during a festival season and expensive when a business is closed. Confirm whether cancellation or pausing is allowed, when changes take effect and whether an annual payment is refundable.
For a simple constant-month comparison, enter the full recurring charge. If you choose annual billing, enter that annual amount rather than a rounded monthly equivalent. The calculator spreads it evenly for cost comparison; that does not reproduce the cash payment date.
Finally, add purchases, exit charges and setup fees. A package can pass the monthly crossover and still take time to recover the cost of moving.
Common questions
Is the monthly crossover the same as switching break-even?
No. The crossover is the sales level where recurring costs match. Switching break-even is the time needed for cumulative savings to cover relevant one-off costs.
Can I use annual card turnover divided by 12?
It gives an average scenario. Use the seasonal calculator for twelve individual months. If card mix or minimum-charge rules vary, calculate each month’s complete cost separately and enter the monthly totals.
Put your own figures to work.
Use the free calculator to organise your costs and keep a report. If something is unclear, you can ask for a free initial review.
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Sources and how to use this guide
Primary references checked on 15 October 2026:
Worked examples are original fictional scenarios, not customer results, market averages or provider quotations. Unless stated otherwise, they use a consistent VAT basis and include only the costs listed. Provider prices, eligibility and terms can change. Check your written agreement before deciding.
Our guides explain costs and comparison methods. They do not rank the whole market or claim hands-on product testing. Source links are references, not a claim of partnership. Read the calculation method and limitations, or about the service.
Explore the provider guides
Apply this method to named providers and your next purchasing decision:
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