YOU WON’T GET RICH IF YOU DON’T GET PAID – Payment Options Available to Freelancers


pay-once-earn-moneyGetting paid for their exemplary work and business projects is a general objective for freelancers and business owners. While some require a lump sum payment after the project is accomplished, others prefer to be paid on a “progressive billing method” or on a regular interval – all depending on their agreement with their clients. Having said this, getting paid should never be an issue as there are several payment methods available which you can suggest to your clients.

Every payment method has its own advantages and disadvantages, including the possibility of a substantial charge for sendng or receiving the money. And there are also a number of things to consider to make sure that you receive your payments with the least amount of trouble as possible.

Your Payment Options

Payment ArrangementCheque

Sending cheques through the post is a common way of getting paid for your freelance work. This is recommended if you have established a trusted business deal with your client. The biggest challenge though is the turnaround time. Cheques sent through the post may take weeks, particularly if your client is from a different country or continent. Plus, waiting a few more days to have it cleared in your account poses a disadvantage especially if you’re using that money to pay for your dues.


For so many years, freelancers and online sellers have depended on PayPal in terms of receiving payments. It has been an efficient channel to send in money. It provdes and instant payment and requires a short time to process the payment. Without having to send your PayPal funds to a bank account especially when you don’t need cash, you can use it as well to pay for services and products you wish to avail. Hundreds, even thousands, of shopping sites and even utility companies opted to offer PayPal as a means of payment for their goods and services.

However, if you wish to encash your PayPal funds, you need to attach a bank account to it to send your money to. It may take a few days for the transfer to happen and the transfer charges maybe quite a disadvantage.

PayPal withdrawals to a bank account may charge you something for the transfer itself, while your bank may also charge you for an “incoming remittance” fee, as PayPal transactions are considered a remittance.

Credit CardCredit Card Payments

If you have a merchant account, and you can accept credit card payments, you can use this option. It allows your clients to have their credit cards charged for the work you did. This is encouraged only though if you’re running a rather sizeable business. Applying for a merchant account maybe quite complicated for individual contractors and the fees can be a challenge.

EFTWire or Electronic Funds Transfer

This is a popular payment method and gets processed way quicker than a cheque through the post. The money is transferred directly to your bank account so you’ll have to provide your account information to your clients. For others this may seem a bit dodgy, with identity theft and onlilne fraud threats present everywhere.

Electronic Funds Transfer is a digital transfer of money from one account to another. This can be from between two accounts from the same bank or across different banks. It is done through conputer based systems through a network. EFTS can be done immediately and can be free while some other banks can charge a small fee for the transaction. Wire transfers through an international banking network, account holder initiated transactions using a debit or credit card, direct deposit to a receiving account by the payer, and direct debit (where the payment is directly taken from the payer’s bank account) are the usual forms of EFT. Once an EFT is initiated, the receiver gets their money in the local currency (unless they prefer it to be sent to a foreign currency account they own).

Wire TramsferOn the other hand, a Wire Transfer is a form of EFT where the money is transfered from the sender the the receiver. This can be done from from one bank account to another bank account or through a transfer of cash at a cash office, such as Western Union. Wire transfer is also known as credit transfer or bank wire. The process of a wire transfer starts with a person telling the bank to transfer a certain amount of money to an account, identified by IBAN and BIC codes. The sending bank transmits a message, via a secure system, to the receiving bank, requesting that it effect payment according to the instructions given. The receiving bank then must accept the transfer. The transfer however does not happen instantaneously. It may take up several hours or even a day to move the funds from the sender’s account to the receiver’s account. Once the funds are transferred, the receiving person can access the funds in their own account. Wire transfer charges are usually higher than other EFT transactions, especially if you’re wiring the money through a cash channel like Western Union or Moneygram.

Popular freelancing platforms offer an EFT method within their site of you create a profile and get your projects there. oDesk and Elance has this option available. You can easily withdraw your oDesk or eLance funds directly to your bank account at a minimal transaction fee. The turnaround time varies from 3-4 banking days and your nominated bank may also charge your for an incoming remittance fee.


This has become quite popular these days among freelancers and works just like an electronic funds transfer. You can sign up to Payoneer for an account and they will issue you your Payoneer Mastercard. It’s a debit card though and you will need funds available in it to use. Just like having an ATM card for your current or savings account. By signing up to Payoneer, you are are given a Bank Of America checking account that you can use to provide to your clients so they can depost your payments there. Transactions can happen immediately if payments are sent within the US while if done outside, it may take 3 to 5 banking days. You can choose to transfer the available money on your Payoneer Mastercard account to a local bank account that you own or get cash using the Payoneer Mastercard at any cash machine allowing Mastercard transactions. The fees may vary.

You can sign up to Payoneer and receive a $25.00 bonus on your account upon joining. The duration of this promo may end soon so take advantage of it now. You can also refer your peers to sign up to Payoneer for a referral bonus of another $25.00 as soon as the first payment of $100.00 is received. Click the photo below to go to the Payoneer website and join.

Payoneer Sign Up

Postal Money OrderPostal Money Order

This is a third-party held option. The payment can be sent by the client through the post or a bank that facilitates a money order to be sent to you. Sometimes both parties are charged by the money order agency for the transaction.

How Do You Arrange A Payment?

Payment Arrangement 2Given these payment methods that you can arrange with your clients, you also have options in terms of making sure that your work is paid as expected.

If you sign up to secure freelancing platforms, your work is guaranteed to be paid as the freelancing platform itself pays you as they charge your clients for it – this usually takes place on an hourly jobs where you can track your work through a software provided by the site. For fixed prce projects, some channels like Elance can charge your client, hold the money for you (Escrow – maybe a third party channel), and make it available via milestone completion or until the project is finished.

However, if you are not tied up with such freelancing sites and you have a personal dealing with your client, you need to creat a consistent billing process and arrange it with them. The risk of getting duped is always there especially if you’re dealing with a new client. After working on the project you need to make time creating a report of your work and a comprehensive invoice stating the summary and the details, plus the invoice amount and your agreed payment method.

Remember that the invoice may nit be paid immediately as the client will have to review the work you did. There may be a few exchange of emails here and there to clarify things. Ideally, you can set a reasonable due date, normally within 14 to 21 days after the invoice is set, or make a more ideal arrangement with your client.

Moreover, if you experience a delay in receiving your payments, you might have to impose a firm rule on this. To avoid making business relationships turn sour, you can offer a sunstantial discount for early payments. Late payment fees can also work but this poses a threat on the client’s side. It all depends on what you and your client will agree on.

Deposits for projects is also strongly encouraged, depending on the kind of services you offer. You can arrange a portion of the total cost of services you offer to be paid up front and then set milestones for the remaining balance. If you’re still apprehensive about this, you can discuss an arrangement with your client that work will start as soon as the deposit is received.

Lastly, a payment plan can also be arranged, but may only work if you have had a long working relationship with your client. For instance, if they suddenly experience a financial difficulty and at that point they are unable to pay you in full, talk them into a way they can pay you in reasonable installment amounts to ease the burden. This will ensure that you’ll still receive payments from them while they are working on their budget to become better.

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