Written by special contributor, Jane Adams.
Working for yourself allows you a certain amount of freedom when it comes to traveling around. Not having to report to the office on a Monday morning means I can be somewhere else, even abroad, just so long as I have my laptop, my smartphone, and a clear head. The downside, if there is a downside to being by the pool somewhere warm and friendly, is that my work usually comes with me.
I’m not alone. A lot of people work while traveling these days. I wouldn’t have it any other way, but it isn’t without its inherent problems. One of the biggest problems is accepting funds from clients while I’m traveling abroad. It’s problematic because sometimes I depend on those payments to get me through my break. There are solutions, but the complexities of international exchange and money transfer mean that if I’m not careful I can end up being badly burnt.
THE COST OF ACCEPTING FUNDS IN DIFFERENT CURRENCIES
The default solution is always PayPal. As if we didn’t know, the consumer resource Financial Wellness reminds us that PayPal is the largest and most widely used third-party payment resource on the planet. Its strength is that it is universally recognized and trusted, and most clients are likely already to have an account. Work at Home magazine recommends it for precisely that reason.
Unfortunately, PayPal’s universal popularity allows it to help itself to far too big a chunk of my hard-earned cash when converting it between currencies. In practice it means I lose 4% immediately upon accepting the funds and then another similar amount upon exchanging them to foreign currencies. In one fell swoop, the payment that I’ve sweated blood for is 8% lighter. That is a hefty proportion of my income. To make up for it, I either need to pass on that fee to the client, making me less competitive or else I absorb the loss myself. All that hard work for nothing. Luckily, as Finder points out, there are other payment providers out there. For instance, I am aware that Payoneer’s fees are lower than PayPal’s, but more on that in a bit.
WHY USING YOUR CREDIT CARD IS USUALLY NOT AT OPTION
What might seem the simplest means of drawing on payments into my account, by using my credit card, is not really an option unless I were to have another bank account at the place to which I am traveling. As this is seldom the case, I end up paying an unreasonably prohibitive foreign exchange fee, or loading charge, and having to deal with a punitive exchange rate to boot. That’s before I even contemplate the interest payment if I fail to pay off my balance in full within the allocated time. A very bad idea, worse even than using PayPal.
Cash withdrawals with a foreign credit card give you a particularly nasty surprise as, in addition to all else, you end up being stung with a withdrawal fee of about 2-3% per transaction. All of this is money I’ve earned whilst working away, disappearing before my eyes.
PAYONEER IS THE OPTIMAL SOLUTION FOR FREELANCERS
This is why I’ve begun to use Payoneer, a lesser-known but still safe and reliable alternative to PayPal and other third-party payment systems. Already operating in approximately 200 countries, Payoneer is used by some of the world’s biggest corporations such as Airbnb, Elance, and even Google.
Payoneer’s charges are more competitive than those of PayPal and are clearly set out so that they cannot easily be misunderstood. Essentially, incoming funds are transferred into my bank account for free, and conversions are priced at just two percent over the mid-market rate (which itself is usually generous). The company achieves this by localizing its global payment solutions in all the major countries and many others besides.
Surprisingly, Payoneer is already fourteen years old and has come a long way since its launch in New York in 2005. With four million customers around the world, 1,200 employees, seventeen global offices and thirty-five languages supported, Payoneer clearly has big ambitions. The favorable reviews for me clinch the deal.
As a freelancer, I receive payments from clients on an ad hoc basis, and can never be certain that I will be at home when they arrive at my bank. Call me old-fashioned but I live to keep as much of my earnings as possible rather than paying a cut to middle-men along the way. Thankfully any charges Payoneer makes are modest and are clearly explained, taking out a whole load of stress from the business of receiving funds abroad.