Santander UK and iZettle announced an agreement to sell iZettle's chip-and-PIN mobile point-of-sale readers to the bank's current business account customers at a discount for £59 (US$70), down from the retail price of £99.

The price drop will be combined with a 100-percent cash-back offer after a user completes their first iZettle transaction.

The Swedish-based company's service consists of an app and a reader that combine with a user's smartphone or tablet via Bluetooth to process card payments. It also provides free analytics tools to help small businesses spot sales opportunities and identify loyal customers. Banco Satander, the largest financial group in Spain and Latin America, in 2013 invested more than $5 million into iZettle.

"Mobile payments have revolutionized the payments industry," iZettle UK MD Jens Munch said in the announcement. "They have allowed SMEs of all sizes to access tools for minimal cost that were previously only available to large companies. We are thrilled to be able to partner with forward-thinking banks like Santander who recognize the significance and importance of empowering SMEs who, after all, are the lifeblood of our economy."

The company's card reader is compatible with all major credit and debit cards including MasterCard, Visa and American Express. There are no set up fees or contracts. Customers pay only when they use iZettle. Transaction fees start at 2.75 percent and reduce to 1.5 percent for those with a high sales volume. The company is currently live in nine markets across Europe and South America.