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Running a restaurant means constantly juggling tasks. The last thing you need is to worry about payments while your guests enjoy their meals. Inefficient payments may ruin their experience. Therefore, having a reliable and secure system is crucial for your brand’s reputation.

Fortunately, merchant providers are available to assist you with all aspects of payment processing. In this article, we look at the best merchant services for restaurants, what they offer, and how to choose a trusted partner.

What Are Merchant Services?

Merchant services encompass everything a restaurant needs to accept and process payments. This may include hardware, software, contactless payments, and other payment methods. Banks, payment processors, and financial institutions typically provide these products.

The required services vary based on the merchant's industry and specific needs. For instance, the merchant services needed for a restaurant differ significantly from those required for a Software-as-a-Service (SaaS) business.

Intricacies of a Restaurant Business

A restaurant's business has a distinct flavour compared to other companies, pun intended. The restaurant’s operations will shape the type of payment systems and merchant services it needs.

For example, a takeaway-only restaurant would need strong online payments. An in-person diner will likely have a high volume of smaller transactions. Additionally, peak meal times may bring a surge in activity, requiring payment systems to handle the volume increase.

Restaurant payments must allow customers to add tips, split bills, and pay via various payment methods, including contactless mobile systems. Payment systems should integrate with table management functions to effectively track orders, tables, and transactions.

Best Merchant Services for Restaurants

Based on these details and specific requirements, let’s look at the merchant services that would best accommodate a restaurant’s needs.

Point-of-Sale (PoS)

The point-of-sale (PoS) system is, quite literally, where sales are made. It includes the software and hardware needed to manage transactions. In physical shops, like restaurants, the main PoS hardware is the cash register, which typically includes an internet-connected terminal, cash drawer, and receipt printer.

Restaurant PoS would require quick transaction speed and scalability as well as table management options like order tracking. There hardware must have a variety of payment methods and options such as splitting bills or adding tips.

Mobile Payments

A merchant service provider can assist in setting up mobile payments via tablets and smartphones. With digital wallets like Apple Pay and Google Pay being some of the most popular payment methods worldwide, it's essential for a restaurant to accommodate these options.

Payment Gateway for Online Ordering

If a restaurant offers food delivery services, they need an efficient gateway and online checkout process. An online payment gateway is a vital technology that acts as an intermediary between the customer and payment processing. It encrypts and transmits payment details between the customer, merchant, payment processor, and banks.

Analytics & Reports

Evidence-based decision-making is essential for sustainable business growth, and this is where analytics and reporting tools become invaluable. These solutions can gather data about your customers and their payment behaviors. An analytics platform with integrated reporting software can help your restaurant organise and interpret this data.

Open Banking

Open banking payments are an innovative payment method to offer, especially when your restaurant has an online delivery service.

To provide some background, since 2018, the EU's PSD2 regulation has mandated banks to share customer data with licensed fintech companies through APIs. This secure exchange of data has facilitated direct account-to-account (A2A) payments, commonly known as Pay-by-Bank or open banking payments.

A2A bring advantages such as rapid fund transfers and a seamless user experience. Customers are redirected from the payment site to their banking app and back, eliminating the need for manual entry of payment details. This enhances the shopping experience, decreases cart abandonment, and provides merchants with quick access to funds. In 2023, A2A payments represented 7% of global e-commerce transactions, according to Statista.

How to Choose the Best Merchant Services for Restaurants

Here are easy steps to choose a merchant services provider for your restaurant business.

How to Choose the Best Merchant Services for Restaurants

Define Your Needs

Create a list of restaurant merchant services that align with your business model. Different restaurants have varying needs. Some may prefer in-store credit card payment solutions, while others might need an online payment system, especially if they offer delivery. Food trucks, caterers, and pop-ups often favour mobile payment options.

Compare Solutions

Refine your options by considering the specific payment tools your restaurant requires. A large sit-down restaurant might benefit from a stand-alone terminal for tableside orders and payments. Caterers could need invoicing features and the ability to accept partial payments. Aim to find providers that offer your desired payment services.

Review Providers

Prioritise getting the best value for your money. While many providers offer zero monthly fees, larger restaurants might benefit more from a monthly subscription that includes wholesale interchange rates. This can lead to greater savings over time, despite the upfront cost.

Other factors you may want to pay attention when comparing providers:

  • Customer Support: Look for providers with a reputation for excellent service and 24/7 availability. Check their communication channels, such as phone, email, and live chat.
  • Security & Compliance: Ensure they adhere to the Payment Card Industry Data Security Standard (PCI DSS) and use advanced fraud protection measures like tokenisation and encryption.
  • Scalability: Select a provider that can support your restaurants’ growth, especially in peak times. Ensure they can work with various payment technologies and types, including point-of-sale systems, online gateways, and mobile processing.

Test & Trial

Evaluate the provider’s services by utilising a demo or trial period. Examine the payment products for their functionality, user-friendliness, and dependability. During this phase, consider the speed of transaction processing, user experience (UX), and any potential issues that may arise.

Merchant Services for Restaurants: Noda

​​Noda is a global open banking provider that assists online merchants with end-user KYC, payment processing, LTV forecasting and UX optimisation. We partner with 16,500 banks across 27 countries, spanning over 30,000 bank branches. Noda supports a wide range of currencies for globally-minded clients. We offer scalable plans to fuel your business growth and e-commerce plugins for easy integration.

With Noda's advanced Open Banking API, online businesses can easily integrate direct bank payments, offering their customers a seamless and secure payment experience with lower fees. Whether you're looking to enhance customer verification processes, optimise payment systems, forecast long-term value, or refine the user experience, Noda is your partner in growth.

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