Lloyds Bank Cardnet review: decent card machines, average fees, slow start-up

What is it?

Lloyds Bank Cardnet – officially Cardnet Merchant Services Limited or Cardnet for short – is a British acquiring bank. Behind the scenes, it is a joint venture by Lloyds Banking Group and the global acquirer Fiserv.

Cardnet offers standard payment solutions including card machines, payment processing, over-the-phone transactions and online payment tools. It also provides a merchant account through which a business can accept payments from any of these sales channels.

The partner Fiserv manufactures and supplies the Clover POS terminals offered through Lloyds, but other terminals from PAX, Castles and Ingenico are available too.

With the Cardnet merchant account, you can process cards by Visa, Mastercard, Maestro, JCB, Discover and Diners Club, with the possibility of accepting UnionPay and American Express too. Cardnet also supports selling in at least 35 different currencies.

All users get access to an online merchant portal where they can check transactions, fees and reports from a browser.

Our opinion of Cardnet

Lloyds Bank Cardnet has everything you need to accept payments, from a decent range of high-end card machines to online payment options for any size business.

The fees are typical in the industry, but an 18-month contract could deter small businesses. The fixed, low rates for debit and credit cards could benefit merchants with lots of tourist customers, since there's no cross-border fee added on top.

We did not, however, like the secrecy around pricing and only got more elaborate fees because we knew exactly which fees to ask about. You'll only know the full picture when you receive your personalised contract with the whole fee schedule, which is a shame for a bank claiming there are no hidden fees.

"I didn't like the slow settlement time (3-5 working days) and registration that takes up to 2-3 weeks. Cardnet's terminals are generally good, particular the PAX and Castles ones. Clover's terminals can be glitchy and expensive, in our experience."

– Emily Sorensen, Senior Editor, Mobile Transaction

Although we did not see too many major red flags about the service, it could take up to three weeks to get started with it, so it's certainly not for those in a hurry. The wait may, however, be worth it for existing Lloyds account holders who prefer to lean on a trusted brand.

Card machines: very varied range

Lloyds offers the following good range of card machines for different setups to rent or lease:

• Cardnet Terminal (PAX A920)
• Castles Technology Saturn S1F2
• Clover Flex
• Ingenico Move/5000
• Ingenico Desk/5000
• Lloyds Bank Cardnet mPOS

All except for the mobile mPOS card reader can print receipts and come with access to online reporting for tracking transactions and analysing sales. Not all of them can integrate with EPOS systems – for details on that, you'll need to ask Lloyds directly.

PAX A920 – no monthly fee

The only card machine without a monthly fee is the portable and mobile Cardnet Terminal (a PAX A920 model) costing £199 + VAT upfront. This is a really popular smart POS terminal with a large touchscreen, receipt printer and built-in apps for taking payments.

We have tested the PAX A920 in different locations and haven't had any issues with the payment process. It feels nice and smooth to hold and lasts 10 hours from a full battery charge. Since it works with both WiFi and 4G (with a SIM card), you can use it on company premises or on the go where there's mobile connectivity.

Other mobile and portable card machines

Lloyds' other mobile and portable card terminals with a large touchscreen and receipt printer built include:

• Castles Technology Saturn S1F2
• Clover Flex

They have similar features as PAX A920, including a SIM card for mobile use, but are rented with personalised fees.

Clover Flex should have a special mention, since it forms part of a whole Clover point of sale (POS) system with very adaptable features. For example, you can add a product library on Clover Flex, have open orders, add discounts and monitor staff shifts. These features are included on the monthly rental subscription, but additional functions are available for an extra cost.

The Taiwanese terminal Castles Saturn is similar to the PAX machine with its large touchscreen, comfortable feel in the hand and quality casing. It works well on the go – I think even better than Clover Flex which is a bit chunky to hold.

If you prefer a traditional portable card machine with push-buttons rather than a touchscreen, Cardnet offers an Ingenico Move/5000. This is more ergonomic for some people who like to feel the buttons, especially those who are partially sighted or blind.

Stationary card machines

The countertop card machines include:

• Ingenico Desk/5000 (with push-buttons)
• Clover Mini (small register)
• Clover Station Duo (bigger register)

They all have colour displays and accept contactless, chip and PIN and magnetic stripe card payments.

We like Ingenico Desk 5000 for its traditional looks, physical PIN pad that's good for accessibility and reliable transaction process. Though it lacks a big touchscreen, Desk 5000 is built for longevity and intuitive use by customers. At all times, it has to be plugged into a power socket.

The Clover models are more like tablets with their tablet-sized touchscreens with apps and POS features. They both have a chip card slot and contactless NFC capabilities built in, so no extra terminal is needed for card acceptance.

Small card reader

If you need something cheap, the Lloyds Bank Cardnet mPOS card reader is an option without monthly fees. It works with an iOS or Android app that has basic functions like a transactions overview, sales analytics, refunds and sending digital receipts – with no extras.

Although laudable that Lloyds is trying to compete with the likes of SumUp and Square, the card reader is an old model with a rarely-updated app at a relatively high upfront cost. We don't recommend card readers with software that's only updated a few times a year, like Lloyds' mPOS app.

Thinking about other options?

View the best card machines in the UK

Pricing: not transparent at all

Lloyds Bank Cardnet is notoriously secretive around pricing (despite claiming to have "no hidden fees"), so the only way to get any costs is to contact them. Cardnet will insist on talking to you on the phone, not share pricing over email, which is even tighter than similar merchant services we received fees from by email.

Quotes are based on your answers to these questions:

• How will you take card payments? Face to face, by telephone or website?
• What is your total annual business turnover?
• How much of your turnover will be processed through the card machine?
• What would be the average transaction value per customer?
• What is the nature of your business?

Our quote

We answered "mostly face-to-face" with an annual turnover of £100k where £90k is through a card machine. The average transaction value was also stated as £7 and the business type a café.

We received the following pricing based on these details:

A one-off setup fee of £50 was required to create the account.

The card machine contract is 18-months long – less than its previous, hefty length of 36 months. We were quoted an early termination fee of £100 + VAT or the monthly terminal rental (£23 + VAT in our case, which is the same as Castles Saturn costs to rent today) x number of months left of the contract.

We were only offered a Clover Flex terminal, but Ingenico machines may have a lower monthly cost because they don't have as many features. The basic software subscription is included in the monthly fee, but you can subscribe to more advanced Clover features if needed.

Fees in general

Whether domestic, foreign, premium or corporate, all debit cards in our quote had a transaction rate of 1.06% while all credit card transactions cost 1.4%. That is, unless we accepted American Express which has a transaction fee of 1.9% (a special Amex contract may be required).

You might get different rates, and Lloyds also generally adds an authorisation charge to transaction fees.

The minimum we could pay in transaction fees a month was £15 (minimum monthly service charge), but this has since dropped to £10 for everyone. For example, if you only receive enough payments to owe £8 in transaction charges one month, Cardnet adds a further £2 on top.

Refunds cost 50p each. Chargebacks – where a customer disputes a transaction with their bank – incur a fee of £12 each.

On top of this, you must pay a monthly PCI-DSS fee of £5.50 to cover Cardnet's payment security standards.

Payouts are free if you can wait 3-5 working days to receive them in your bank account. If you need next-day settlement, a charge of 81p applies if your business bank account is not with Lloyds, or 21p if you signed up with a Lloyds bank account.

The pricing can differ between users. We've seen quotes of up to £199 in setup fee, £25 minimum monthly service charge and a fixed rate of 1.25% for Visa and Mastercard transactions. You generally get lower fees if your business account is with Lloyds Bank, as seen above with the next-day payout fees.

App-dependent card reader has different fees

The Lloyds Cardnet mPOS reader has a different set of fees:

The £49 setup fee pays for the card reader that can be used for 12 months initially.

According to Lloyds, the mPOS package is "currently part of a trial intended to last for at least 12 months and on a rolling basis with two months' notice thereafter." In other words, Lloyds may not continue to offer this card reader service beyond the first year.

There is no monthly rental fee or monthly minimum service charge, only a pay-as-you-go rate of 1.75% for all card transactions, even if an international card is used. American Express can only be accepted with a contract directly from Amex.

There is no requirement to pay for PCI-DSS compliance for the mPOS service. A monthly PCI-DSS fee only applies for the above card machines that are rented.

Remote and online payments: standard options

Apart from card machines, Lloyds offers a versatile online payments package linked to your merchant account. The payment tools include:

Those who wish to sell through a website can easily integrate Lloyds' online payment gateway or build a simple online store from scratch through a specific ecommerce partner (revealed at sign-up).

The all-in-one website solution enables you to add products, manage orders, get notifications and more from an app or browser. You can create a free single-page online store, but anything more advanced will likely cost extra. PayPal can be added as a payment option on the online checkout page.

You can send payment links by text, email or other context. Through the partner Access Hospitality (formerly QikServe), you also have the option to create a custom ordering flow through QR codes and your own app.

Additionally, merchants can process cards remotely through a virtual terminal (requires stricter security protocols) while taking an order over the phone.

Different costs apply to these online features compared with the in-person payment products.

Signing up: not fast

You can choose to get started through:

• Lloyds Bank Cardnet
• PayPoint (reseller)

We recommend registering directly with Lloyds Bank to avoid additional fees and middlemen that complicate terms. However, even though Lloyds is a major retail bank, the service can drag its heels when you try to set up a new account.

There's a long online registration form for Lloyds Bank/Bank of Scotland customers with an estimated annual card turnover of less than £500k, which takes 20-25 minutes to complete. This route can get you set up within 7-10 working days from the day you sign the contract digitally.

Another short contact form is for everyone else who wants to discuss the packages. Lloyds will insist on speaking over the phone, and the form states "it's worth allowing 10-15 working days from your application for your Lloyds Bank Cardnet account to be set up."

After we completed the latter form and heard back from the bank, it took several days in between emails just to get a basic quote. In most cases, you'll get a faster quote on the phone, as Lloyds is eager to get verbal information about your business to provide an accurate list of costs.

During the application, you may be asked to set up a Lloyds business bank account for a better deal if you haven't already got one, but it is possible to use your own account.

Service and reviews: a bit limited

Cardnet's customer support is available to phone on working days between 8am and 9pm – not weekends, Bank Holidays or late nights. This is actually less than a few years ago when the helpline was open on Saturdays and weekday evenings. An urgent terminal replacement is not available on weekends either.

You can email them any time, but response times can be several days in writing despite a promise to respond within 48 hours. You may also have to chase them up for non-urgent queries.

Judging by its promising user reviews, Lloyds Bank Cardnet's user base has grown in the past couple of years. We originally only saw 10 reviews on Trustpilot, all 1-star (quite a feat!), but the average rating on Trustpilot is now 4.3. It's good to see that users with a poor experience get a genuine, empathetic reply from the bank.

Because of past issues, though, it's hard for us to recommend it as a trusted service, but we have likewise not seen enough red flags to discourage you from using it.