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Becoming a freelancer is a great way to work with interesting clients and have a flexible schedule. But it can come with its own challenges- and for Indian freelancers, that can be how to get paid.
There are a few different payment options you have as a freelancer in India. Here is a list of popular ways to get paid from international clients:
Each of these methods will have their own fees, speed, access, and ease. On top of that, you’ll also notice that different payment methods will have different exchange rates.
Some platforms set their own exchange rates which include a mark-up. While others, like Wise, use the real mid-market exchange rate which is what the banks use and the same rate you see on Google.
Let’s take a look at how each of these payment methods compares if you are freelancing from India.
|Payment method||Fees||Exchange Rate||Speed||Convenience|
|Wise Business||One transfer fee||The mid-market exchange rate||On popular routes to India, a few minutes||Web/Android/ iOS app|
|PayPal||Transaction fee and currency conversion fees||A 3% exchange rate fee||Instant payments between PayPal wallets, then 2-5 business days for bank deposit||Convenient and seamless but will require everyone to open a PayPal account|
|Payoneer||Payment, conversion and withdrawal fees||An exchange rate fee||Can take up to 2 business days||Convenient for multiple platforms that use it, but you’ll have to go through a few steps and fees to get funds in your bank account|
|Google Pay||Fees per Wise or Western Union||Midmarket rate with Wise or marked up exchange rate with Western Union||From a few minutes to 2-5 days||GPay is not convenient for global payments and uses Wise and Western Union to send payments from the US or Singapore.|
|Wire transfer||Depends on the bank but can include foreign transaction and conversion fees||Determined by the bank, and is often marked-up||2-5+ business days depending on the bank||Not very convenient but can be done easily through online banking if the bank has the option|
|Escrow||Escrow does not have fees as it is a holding tool||Not applicable||The funds can be held as long as the platform decides; for Upwork, it is 14 days after completion||Escrow is a good way to guarantee payment to the freelancer and client if the work is complete|
|Western Union||Transfer fee||Western Union’s own exchange rate||Instantly for payments up to ₹2 lakhs to India||An easy to use website, online apps and physical branches|
|Stripe||Processing fee||Currency conversion fee of 2%||Paid on a rolling basis depending on your bank||Strong tech makes Stripe convenient to use but only for those who qualify.|
Let’s take a closer look at each payment method.
Wise is a simple and fast way to get money to India from abroad. By using modern secure tech, transfers can arrive within seconds on popular routes to India- right into bank accounts. With one low transfer fee and the real exchange rate, which means no hidden markups, you are likely to receive more of your earnings in every transfer.¹
PayPal is popular in global payments with the PayPal wallet, but has restrictions for Indian users and can come with high fees.
PayPal has limited features for Indian users, so you can only use it for receiving payments if you are a registered business with a PAN in India.
But if you are set up with the requirements, you will have access to easy payments globally into your PayPal wallet. From there, you will need to then withdraw into your Indian bank account, but keep an eye on the fees. ²
Payoneer is used by digital marketplaces for sellers or freelancers to get paid, and while it is convenient, watch out for the multiple fees.
Payoneer is useful for Indian freelancers and sellers for marketplaces like Amazon, Airbnb, and platforms like Fiverr or Upwork. You can get paid into your Payoneer account and then withdraw the amounts to your local Indian bank account.
But you can expect a fee when you get paid, and when you are looking to withdraw the funds. One perk of Payoneer is that you can get paid like a local with Payoneer’s receiving accounts, but you will then need to convert the payment.³
Google Pay in India works great domestically for Indian rupee payments, but you can only receive payments from abroad from the US or Singapore.
Google Pay, GPay for short, is an option for freelancers or businesses in India if you are looking to get paid only from the US or Singapore. It of course works great inside India for payments.
But this is not a feasible option if you are looking to get paid from different countries other than the US and Singapore. GPay does use Wise and Western Union when processing the American or Singaporean transfers. ⁴
The classic way to transfer money, wire transfers are compelted through banks and is a sure-fire way to get money to India, but it can take time.
Wire transfers are a safe way to transfer funds from one bank to another globally using the SWIFT system. Clients can go to their bank or complete a wire transfer from their online banking to your Indian bank account. The downside is that wire transfers can have more fees and take more time than more modern options. ⁵
Escrow is often used to hold future payments while a job is being completed and then release the funds to the recipient when it is done.
Escrow is a convenient financial tool that reassures both the freelancer and client about the work getting done and payment coming through.
Platforms like Upwork will ask clients to make the payment towards a fixed price job beforehand and the platform will put that payment in Escrow. After the freelancer completes the work at the set milestones, the payment is released. Otherwise, if the job is not completed to satisfaction, the payment is not made to the freelancer.⁶
Western Union is a strong option to get real-time payments from around the world to your UPI bank account
Western Union is a great choice for individual to individual payments to India and can be done online or through the app. There is a transfer fee and a marked-up exchange rate on every transaction so it is a good idea to research versus competitors to make sure you are getting the best deal.
One note, the transfer fee depends on how the payment is being made - with credit cards carrying the largest fee.⁷
Stripe is making its way into India, and while it accepts international transactions it is only for registered businesses.
Stripe uses strong technology for its platform, but it is not the best set up for Indian merchants or freelancers unless you have an existing import/export code. On top of that, there is a 2% conversion fee on international transactions and a 4.3% processing fee for cards outside India. ⁸
Choosing the right payment method can make a difference in how, when, and how much you get paid.
Some freelance websites may not give you a choice, but if you have the option to choose, here is how to consider the right provider for you:
- Total fees: Fees can quickly add up so it is important to make sure you have considered all the fees involved. For international payments, there can be transfer fees, currency conversion fees, and exchange rate fees with certain platforms. Read through each platform closely to make sure you reduce your fees and get more of your earnings.
- Speed: You got bills to pay, so making sure your payments get to you on time will make life easier for you. Decide if you have the time to go through platform wallets, or would rather prefer payments directly to your Indian bank account.
- Support: Do you want a community to ask questions to, or 24/7 customer service? Both options can be helpful to navigate through payments with international clients but consider how much support you would like as a freelancer. Mediation services may also be worth considering in case there are issues with a client.
- Convenience: Find a method that works the way that you work. Would you like to check transactions on the go? Then a payment method with an app may be the best fit for you. Also, consider what are easy methods for your clients to sign up and use.
- Trust: When talking about livelihood, it's important to make sure you have a payment method you can trust. Established brands that work in and with Indians will help make processes easier. Also, check customer reviews to get an idea of what it is like as a user.
Sources used for this article:
All sources checked as of 24 December, 2021
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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