Pay by bank for small business: Cut card fees
Michel Myara is co-founder and product designer at looch, where he designs the ecosystem small businesses use to get paid and manage spend while keeping penny-perfect books.
Pay by bank for small business cuts the cost of larger invoices
Updated August 2026
pay by bank costs 1% and caps at $10. Online card payments cost 3.3%. At 1%, the cap keeps larger invoices from growing in cost. The 1% rate is the economic difference on larger invoices.
Last verified: August 19th, 2026.
For a small business using looch Pay, pay by bank costs 1% (min $1, max $10). Online card payments cost 3.3% + 30¢, so once an invoice reaches $1,000, the pay by bank fee stops at $10 while the card fee keeps rising.
That cap changes the math on the work that matters most: Larger invoices, repeat clients, and sales where every point of margin counts. Cards still have a place. looch gives you both, so you can offer the payment method that fits the sale instead of treating card fees as unavoidable.
| Payment method | looch Pay fee | Best fit |
|---|---|---|
| Instant pay by bank | 1% (min $1, max $10) | Invoices where the capped fee matters |
| Card online | 3.3% + 30¢ | Familiar online checkout |
| Tap to pay | 3% + 15¢ | Quick in-person sales |
| Foreign cards | Add 1.5% | Card payments from abroad |
A card payment can be disputed, and looch charges $35 per dispute when one is raised. Countering a dispute is free. With instant pay by bank, money is final on arrival, so no dispute arises and no dispute fee applies.
On a $1,000 invoice, the difference is plain: $33.30 by card, $10.00 by bank. On a $10,000 invoice, it is $330.30 by card, still $10.00 by bank. Below about $21, the $1 minimum makes a card the cheaper option.
Instant pay by bank puts the customer in control
pay by bank isn’t a card payment with a different checkout screen. With looch Pay, you send an instant pay by bank payment. Your customer sees who is asking, the amount, and the reference, then approves the payment from their own bank.
The sequence is simple:
- You send an instant pay by bank payment with the amount and reference.
- Your customer reviews and approves it from their bank or in looch.
- The money is pushed to your looch account.
You ask. Your customer approves. The money moves.
That’s the important distinction. An instant pay by bank payment starts with a message, not a pull. There’s no card number for the customer to enter and no card details for your business to store. The approval happens at the customer’s bank, where the customer can see exactly what they are authorizing.
Final settlement is the benefit behind pay by bank
With instant pay by bank, an approved payment is pushed and settled, not pulled through a card network.
For your business, that means money that arrives done. There are no disputes, chargebacks, or reserves. The funds you receive are funds you can use.
The payment method doesn’t change the customer experience. They approve a clear request from their own bank. You get a payment method built for the invoices where card percentages become expensive. Some banks support instant payments and the money arrives in seconds. Payments from banks that don’t yet support them take 4 business days to arrive.
Sources: looch pricing.
The cap makes the savings easy to see
Every figure below uses looch’s published rates: Pay by bank at 1% with a $1 minimum and $10 maximum, and cards online at 3.3% + 30¢.
| Invoice | Card, online | Pay by bank | You keep |
|---|---|---|---|
| $50 | $1.95 | $1.00 | $0.95 more |
| $100 | $3.60 | $1.00 | $2.60 more |
| $500 | $16.80 | $5.00 | $11.80 more |
| $1,000 | $33.30 | $10.00 | $23.30 more |
| $2,500 | $82.80 | $10.00 | $72.80 more |
| $10,000 | $330.30 | $10.00 | $320.30 more |
The cap reaches $10 at $1,000. Every invoice above that amount costs the same $10 to collect by bank. A foreign card adds 1.5% to the card side, while the pay by bank fee remains capped.
That doesn’t mean looch wins every rate comparison. looch’s online card rate sits above the 2.9% + 30¢ that several competitors publish. Our survey of all-in-one financial platforms for small businesses explains where those products can be a better fit. For businesses collecting larger invoices, though, the pay by bank cap can outweigh the difference quickly.
Larger invoices are where pay by bank does its best work
A $5,000 invoice costs $10 to collect through pay by bank and $165.30 by online card. That is not a rounding error for a service business, contractor, consultant, or any operator billing substantial work.
The same logic applies when a client pays you repeatedly. Once a client understands the approval flow, pay by bank gives them a direct way to pay without entering card details again. Your cost stays lower on each payment, and the payment arrives final when it lands.
Thin margins make the choice even clearer. When you have already priced a job carefully, giving away a growing percentage of the invoice can erase the room you built into it. Pay by bank gives you a way to accept payments without cards when the economics call for it.
See the complete fee details on the looch pricing page.
Cards are still the better choice for some sales
A good payment setup doesn’t force every buyer through the same path. Cards remain useful, and sometimes they are the better instrument.
- Small tickets: The $1 minimum means a card is cheaper below about $21. At a $10 sale, a card costs 63¢ against $1.00.
- First-time customers: Card checkout is familiar. For a customer who wants to pay quickly with the card already in hand, familiarity can matter more than a lower fee.
- Quick in-person sales: Tap to pay at 3% + 15¢ is built for a counter and a fast decision.
- Card rewards and preferences: Some customers want to use a specific card. Giving them that option can be worth the additional cost.
looch Pay lets you accept cards alongside instant pay by bank. For card payments, you can also decide per payment whether your business pays the card fee or passes it to the contact. That keeps the choice in your hands without turning away customers who prefer cards.
looch connects getting paid to the rest of your business
Most payment tools stop at the transaction. looch is built for the operator who wants the payment, the account it lands in, and the books around it to work together.
If you already run your business in looch, use looch Pay to accept instant pay by bank when the invoice is large enough for the cap to matter. If you’re starting from scratch, form your business and open an account with looch Start, then move from formation into accounts, payments, Smartcards, and real-time accounting in one app.
pay by bank won’t replace cards for every sale. It gives your small business a better option for the sales where card fees should not keep growing with the invoice.
