How to find the best payment platform for freelancers

Since 2000, the freelance worker segment in the EU labor market has experienced a 45% increase. With this ever-increasing number, their income also increases, and this sum must be retained and protected. So it doesn’t matter if you’re an experienced freelancer looking for several different ways to receive money or a newbie looking to find the best payment platform – this article will help you both.

How to choose a financial platform

As an independent professional working online, you need to get an e-wallet or a bank account for these primary purposes: to accept transfers from clients, keep the funds and withdraw them in cash. For some, it is also important to be able to pay the tax through it. Seems to be pretty easy since every payment system offers this basic functionality. But let’s look under the hood and see what lies behind.

Safety

According to Accenture Global Consumer Banking Study, 76% of users value help in managing cybersecurity threats when choosing a provider. It is important to have a financial platform ready to meet such challenges. The platform’s internal fraud prevention tools play an important role as they prevent financial institutions from AML risks and breaches.

When looking for a financial provider, make sure it offers clients tools such as two-factor authentication, instant alerts (so you’re aware of everything going on in your account), set transfer limits, and card security features.

Payment methods and cards

In case you offer professional services not only to companies but also to individuals, make sure that you can be paid not only by bank transfer, but also by a card that will be accepted, as well as local payment methods. In most cases, there aren’t many problems with that since most systems accept Visa and MasterCard work on them, but if you’re working with North America, make sure you have American Express and Discover accepted.

Processing time for payment

Depending on service plans and the geography of a transfer, another platform takes time to process the payment. Usually, the standard transfer time takes between 1 and 7 working days. This function is particularly important if you work with cross-border payments and different currencies. Some platforms also offer faster payment processing time as a premium service.

Top-up and withdrawal

An opportunity to withdraw the funds in cash or use them directly from the card or an account is another thing that freelancers consider an important part of a financial product. This works for both regular expenses and business payments. In case you have several cards and manage a team or use some paid services for work, it is worth having a top-up function to ensure that you can pay them from your account.

24/7 customer support

Customer support is crucial when it comes to money, so check if your payment platform has it immediately available in your language. Check if they have a hotline, email, chatbot in the app or on a website, or contact form to quickly solve your problems.

Costs of commissions

Most payment services have different fee systems. These can be fees per transaction (usually fixed price + a percentage of the amount transferred) or premium fees for a faster transfer. Also, some platforms charge to open an account or monthly/annual fees for use. And look for the hidden fees that can’t be advertised directly.

These were the main things to be aware of, and now let’s take a look at some of the platforms you are likely to choose from.

Popular payment services

PayPal

PayPal is one of the most popular and oldest e-wallets for freelancers. It makes it possible to connect several different cards and accounts to receive transfers, make payments, withdraw money and pay for services. Today, PayPal is available in 202 countries and allows payment in 26 currencies. PayPal accepts bank transfers, MasterCard payments and checks. It is available as a website and an app. Average transfer time is 3-5 days with 4.4% + flat rate based on a country commission for transfers outside the US and $0.30 + 2.9% of the amount received for US transactions .

Genome

Genome is an electronic money institution licensed and supervised by the Bank of Lithuania. As of 2018, the platform allows you to send and receive SEPA transfers in the Eurozone, exchange currencies with a 1% fee, pay for services and open up to 15 accounts in USD, EUR and GBP. Wallets have extra protection against fraud with two-factor authorization and the fraud prevention platform Covery. Genome offers Visa virtual and physical debit cards that can be opened through the app or on a website with the GooglePay contactless function. Genome has one of the most transparent pricing with no hidden fees that takes 1-3 business days with €1 commission for the EU.

Payoneer

Payoneer is a global payment network that works in collaboration with many freelance platforms. They provide the ability to receive international transfers, receive payments directly from platforms such as Upwork, Airbnb, Fiverr, 99Designs, iStock, pay EU and UK VAT, and pay for purchases. They accept MasterCard, checks and bank transfers. Average time transfer takes 3-5 business days with $2.99 ​​commission for a local bank transfer and $15 for a USD SWIFT transfer. For USD and EUR SWIFT transfers, the commission is $4 or 1%.

Revolut

Revolut is a neobank registered in the UK in 2015, offering services for currency exchange, debit and virtual card creation, commission-free share trading, cryptocurrency, purchases and money transfers in the UK and EU. They offer multiple accounts in 29 currencies. You can also pay your taxes directly via Revolut based on your tax residence. Revolut offers MasterCard or Visa cards that are available for contactless payment via ApplePay and GooglePay. The account is free, as well as the same currency transfers, but on weekends the commission is 0.5%. For additional features, users can get a monthly subscription for $6.99-12.99 monthly.

Wise

Wise was launched in 2011 to facilitate international transfers. The company offers transfers to 200 countries via SWIFT in 53 currencies. Users can create multi-currency IBAN accounts registered in the UK, receive a US routing number, exchange currency and pay for services. The platform accepts transfers via Visa, MasterCard and some Maestro cards. The average transfer time is 1-4 days, depending on the country and the amount of money. A transaction fee also depends on this factor, usually it is 0.4% + £0.80 flat transaction fee.

Stripe

Stripe is a platform that provides payment processing services for online businesses, e-commerce and creators. In addition to money transfers, they have a fraud prevention solution within the platform that enables sending invoices, issuing virtual and physical cards and managing expenses. Currently, the platform works in over 20 countries with over 135 currencies. Stripe accepts payments via credit and debit cards and bank transfers. Transfers are processed in 5-10 days with 2.9% + $0.30 commission per transaction.

MoneyGram

MoneyGram is a payment platform available in over 200 countries in 45 currencies and is one of the largest financial institutions operating in the United States and Puerto Rico. MoneyGram’s main services are deposit accounts and international money transfers, but it also makes it possible to pay bills directly and make purchases. Payment methods in addition to cards and bank transfers include cash pickup, home delivery and electronic wallets. They offer deferred payments and a unique transfer tracking feature in MoneyGram Sendbot for Facebook Messenger. Transfers are processed within 24 hours with a commission of $11 per online transaction. For regular customers, they have a loyalty program MoneyGram Plus Rewards, with discounts for transfers.

Final word: is it worth using more than one payment provider?

As a famous saying goes, don’t put all your eggs in one basket. Sometimes even the best platforms experience technical issues, and it can happen that you get a cool project from a place you often work with. And no matter how great your platform is, there’s no way it will cover every single currency and geography at once. For this case, you must have a separate account in stock. Here’s the main tip: get the main platform that’s best for your target region, and make sure the second one has a completely different number of countries and currencies that your first account doesn’t cover.