Contractors’ Questions: How can I get paid easier and faster by my overseas clients?
Contractor’s Question: I have started freelance contracting and thanks to the wonders of the web have secured several clients all over the world -- despite covid-19’s best efforts!
Now I’m starting to think -- how could I be paid easier and faster than I am at present? So what international bank cards, if any, are worth considering?
The issue I’m having is that my local bank is processing all the payments but it takes such a long time that it drives me crazy. And the fees are hefty. It‘s a good bank for local transactions but not for international – even if you just want to receive money in different currencies which is all I really need to do. Please advise.
Expert’s Answer: Many freelance and contract workers use their banks to process international payments, especially when they’re starting out. However the process can certainly be slow and the transfer fees applied can quickly add up.
If you’re looking for a reliable way to send and receive international payments, creating an account with a currency transfer provider is one option.
Depending on the provider, you should be able to manage payments in over 40 global currencies and covering more than 120 countries. This is especially handy if you plan to keep growing your international client base. That being said, some currency providers are more restrictive in the currencies they offer.
How fast is fast?
Transfer speed can also be affected by the currencies involved in your transfer. While transfers can take one-to-two days for currencies like the euro and US dollar (or same day if you have funds on account), more exotic currencies can take longer. You may also have to provide additional documentation for compliance purposes if your transfer involves a currency or country considered ‘higher-risk’.
Once you’ve registered with a provider, you can instruct your clients to pay into that account directly.The registration process should be relatively straightforward, though you will be asked to provide information about you as an individual and the company the account is for. Again, the amount of information you will have to provide can depend on where your company is situated.
The bottom line (and your own expert)
When your clients have paid their funds into your currency account they will be held in a digital currency wallet until you want to transfer them into your domestic currency. You have the option to transfer the funds immediately, or hold out for a more favourable exchange rate. Making transfers in this way is quick and convenient and can help you avoid transfer fees. It should be noted, however, that some providers do apply transfer fees outside of the exchange rate they quote. It’s important to research the company you plan to use to have a true idea of potential costs.
Other benefits of registering with an international currency transfer provider include being able to set rate alerts (so you get updated when an exchange rate has moved in your favour), and having the support of a dedicated currency expert. While they can’t offer you advice, they can provide you with regular market updates so you can make an informed decision about when to move your money.
They can also give you access to services that your bank can’t, like forward contracts (where you fix a rate in advance of a transfer) and limit orders (where you target an exchange rate higher than the current market level). While fixing or targeting a rate would protect your transfers from a sudden dip in the currency market it would mean you would miss out if the exchange rate strengthened, so this is another area where research is important. Best of luck!
The expert was Matt Andrews, senior currency analyst at TorFX.