Best Ways to Pay Independent Contractors


Payments to independent contractors is often cheaper and easier to prepare compared to paying regular employees as you don’t withhold tax for them or provide any sort of benefits. Contractors usually have their preferred methods for receiving their wages. Services like Wise Multi-currency account and Payoneer are some of the most traditional ones as they're cost-effective.

But are these services also cheaper for employers?

Let’s find out!

Money Transfer Services

You're probably also considering to use banks to pay your independent contractors overseas as it's the most traditional service out there. But here's a quick heads up on the fees and how money transfer services can save you a few bucks.

The average cost to send funds overseas using traditional banks range from 3 - 4% of the amount being transferred due to SWIFT fees that costs $20 - $50 per transfer and an exchange rate mark-up of 2 - 4%. This means that transfering a $1000 to EUR can costs around $40 - $70 plus a receiving fee charged by the recipient's bank. The good news is that there are Money transfer Services that could save you over 40% on international transfer fees. Let's have a look at some of the best ones in the market.


The convenience of using the multi-currency account together with the batch payment tool for running payroll in different currencies makes Wise work seamlessly both for employers and contractors. Employers can pay in 45+ currencies and contractors can use Wise multi-currency account to receive their wages and take advantage of the cheap conversion fee.

Cost$5.16 (0.35%-3%)
Speed0 - 2 working days
  • If you’re paying multiple contractors, you can use a dedicated tool for running payroll - Wise Batch Payment so instead of making several payments separately, you can make multiple payments in one go.
  • You can make and track business payments via the app.
  • The business can be integrated to accounting software called Xero to help ease your tax reconciliation.


  • Real Exchange rate
  • High Transfer limit - up to $1,000,000
  • Low transfer cost
  • Recipients don’t need a Wise account to receive payments
  • Instant transfer for some currencies
  • Accepts Payments through debit and credit card, ACH direct debit and Wire transfer
  • Bank-level security.


  • Business and personal accounts need to get verified first
  • No Cash Pick-ups
  • Recipient cannot track the status of the transfers


Payoneer’s services are quite similar to Wise. They provide local account details in different currencies where contractors can receive payments for free. Employers can make international payments to overseas contractors.

Cost$27.50 (2% withdrawal fee¹ + 2% currency conversion) no withdrawal fee for payments to Payoneer users²
Speed1 - 2 working days
  • You can make payments on the app.
  • Can be integrated to accounting software
  • Recurring payments for eligible accounts


  • Free payments between Payoneer accounts if in the same currency
  • Provides a MasterCard that can be used on a large number of platforms
  • A lot of contractors are already using the service to receive payments which means that it would be easier and cheaper to send funds to them


  • Fees to use the MasterCard can be quite costly ( up to 3.5% for cross-currency transactions)
  • Recipient's account details need to get approved first which can take 1 - 2 working days
  • Currency conversion charge can be higher compared to other services


OFX doesn’t charge a transfer fee however, they make money by adding a mark-up on their exchange rate which can vary according to the transfer amount and your transaction history with them. It’s usually higher for smaller amounts and vice versa.

Cost$4 - $25 (0.4 - 2.5% exchange rate mark-up)³
Speed0 - 1 working day
  • You can make payments on the app.
  • Can be integrated to accounting software
  • Can set up recurring payments
  • Batch payments tool


  • No transfer fees
  • No transfer limit
  • Operates 24 hours a day, 7 days a week


  • Exchange rate mark-up
  • Doesn’t offer same-day delivery
  • Minimum transfer is $2,000

The fees shown above are the estimated cost of a $1000 transfer to EUR. Fees may vary according to currency and country you're sending to and from.

2. Payroll Software

Bigger companies often employ payroll software for larger payout volume but it's usually more expensive due to monthly subscriptions and cost per employee. But this reduces errors and eases tax reconciliation. There are a few services that are tailored to small and medium enterprises. Here are some of them:


In order to run Payroll using BitWage, the employees need to be invited to set up a receiving account so even though the service is cost effective for companies, the challenge comes from convincing employees to use BitWage to receive their wages. Unfortunately, as it can be quite expensive for them due to 1% charge per deposit, or $15.99 per month for the Premium Invoicing service, they tend to use other services that charge no fee for receiving payments

Cost1% fee on local currency wage distribution (for standard subscription). $7.99 or $15.99 monthly subscription charge for premium account.⁴
Speed0 - 1 working day
  • Transactions can be tracked on the app.
  • Payments in 3 distribution types including digital currencies.
  • Provides receiving accounts to contractors


  • Helps manage employee salary and sends necessary form to fill out
  • Less expensive for employers


  • Best suited for workers who prefer to be paid in Bitcurrency.
  • Employees need to use the service too in order to receive payments


Paylocity offers payroll services, HR, talent management, attendance, and benefits administration functions and supports mobile apps to conduct workforce management on the go.

Cost$2 to $4 per employee/month⁵
Speed0 - 1 working day
  • Accessible via the app.
  • paycheck calculator
  • payroll templates
  • employee paychecks verification
  • check-creating option.


  • Offers a number of resources that help streamline payroll processes
  • Saves you a of time on admin work
  • Easier tax reconciliation


  • The interface is often not intuitive.
  • Can be expensive for companies who run payroll in small volume

Paychex Flex

Paychex Flex offers the compact package of human resources management solutions that integrates HR administration, retirement, ATS, HRIS, and employee benefits.

Speed0 - 1 working day
  • Accessible via the app.
  • Integrates with several accounting software


  • User friendly and fast
  • Saves you a of time on admin work
  • Offers a few other resources that help with HR processes


  • Can be expensive for companies who run payroll in small volume
  • It can take a while to familiarize

It's important to keep in mind that the cost shown above is not final. These are just the cost to employ payroll software to help manage and calculate your employee’s wages. For most services, you’d have to integrate a bank or financial tools to execute the payment. Also, keep in mind the minimum head count per payroll. Most companies have 20 employees minimum volume.

  1. Payoneer about - fees
  2. Payoneer blog post
  3. OFX FAQ
  4. Bitwage price page
  5. CrozDesk

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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