Freelancer’s Guide to Alternative Payment Methods (MPA)

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As a freelancer, the importance of having a means of receiving payments from clients cannot be overstated. Sometimes it may be more convenient to use a regular bank account. In other cases, you may need to use a different payment method to receive your customer funds due to location and region.


Imagine you can’t find a customer because they live in regions that prohibit financial transactions with yours. Or, even when you can complete a transaction, the fees and long transaction times can render the funds virtually useless upon arrival. This is where alternative payment methods come in.


What are alternative payment methods (APM)?

Alternative payment methods are alternative financial platforms that help you get paid as a freelancer. Unlike traditional banking services, they do not necessarily involve physical assets such as cash, credit or debit cards. Instead, they come in the form of prepaid cards, mobile payments, e-wallets, bank transfers and instant “buy now, pay later” funding.

These days, APMs are the mainstream choice of many freelancers, especially since they offer flexibilities that traditional financial institutions lack. Plus, they’re more aware of the changing tides of internet integration in society, and you have payment methods that adapt to changing times and rise to the occasion if needed.

Despite their popularity, many people are only aware of a handful of APMs, with PayPal leading the way. However, there are plenty of alternative payment methods ready to use anytime, each with unique features and global availability. That said, let’s move on to some of the ones used by freelancers both on and off freelance sites:

This payment platform is the closest rival and alternative to PayPal. With just a few clicks, you can make and receive payments via Payoneer. It’s easy to navigate the platform’s interface and track your transaction history and account balance. Key features include bulk and one-time payments, as well as in-app payments, allowing users to receive and send funds quickly. One of the advantages of Payoneer is the speed of transactions.

The platform is recognized in more than 200 countries and around 150 currencies are available on the platform. Transactions from Payoneer accounts are free in the following currencies: USD, JPY, EUR and GBP. The disadvantages of Payoneer are that there is a 2% fee for withdrawing foreign currencies, and the fees on MasterCard withdrawals are quite high. It also takes up to a week for your money to reflect in your bank account.

This payment system allows users to send money to different countries. The most notable features of Skrill are that it supports free accounts, supports credit card transactions, transacts via email addresses, and provides quick access. The service also offers cheap transaction fees, which stands out the most.

It supports transactions using your email address and has a high level of security and fraud control. However, Skrill also imposes certain limitations on accounts. For example, you cannot withdraw more than $2,000 at one time. Also, it takes 2-5 business days to complete a funds transfer. If you make a transaction during the weekend, it will take longer.

But there is good news: you won’t have to pay any fees when you receive your funds in the United States. The withdrawal fee is fixed at $5.50. You can read more about Skrill’s fees and structure on its website.

This payment system is considered one of the leading electronic money transfer services today, offering various online payment options to its users. You can use it to send and receive money, allowing easy control over your money and helping you keep money in a secure online wallet.

The advantages of using Neteller are its availability in several countries. It also supports more than 22 currencies and offers fast recharges to your account through new payment systems like cryptocurrencies. A major downside is the transaction fees. Depositing funds costs around 5% of your deposit, while withdrawing to bank accounts costs 10% per transaction.

PayPal is the most popular APM for many freelancers for several reasons. For one, it takes about 24 hours for the transferred funds to reflect in his bank account. However, for a small fee, you can upgrade to faster processing speeds with the instant payment method.

PayPal transaction fees are based on your location and you will be charged 2.9% in most cases. For cross-border transactions, fees can reach 4.4%. Benefits of using PayPal include fast receipt of funds, online invoicing, payment via email addresses, and support in multiple languages. PayPal is now available in over 200 countries.

Its biggest drawback is the higher account fees compared to other payment methods. Also, your account could be frozen at their discretion without notice or violation of the rules. It is also full of malicious instruments and users. You want to beware of PayPal chargeback scams and know how to avoid them.

Making and accepting payments on Square is fast, easy, and secure. Funds can be received as quickly as the next business day. Square has since changed its name to Block, bringing its other services, such as Tidal, Cash App, and TBD, under one roof.

The platform allows users to accept payments anywhere and anytime, even without an internet connection. Users can also monitor their cash flow with real-time updates. It is available in around 150 countries and supports around 90 currencies. Transaction fees on the platform depend on the amount at stake, so they change from time to time.

Venmo is another reliable payment method used by freelancers today. Initially, people only used Venmo for online payments. Today, it provides e-wallets and various payment gateways for freelancers and entrepreneurs. The service is also owned by PayPal, with the acquisition completed in 2013.

The outstanding advantage of Venmo is that the accounts are free to open and you can enter through Facebook or an email account. It is the ideal solution for quick and convenient payments. Credit card payments also incur low fees.

The cons of Venmo are that it doesn’t support international payments, can’t be used outside the United States, and requires a bank account in the country to be eligible. Transaction fees vary from 2% to 4%.

Why Freelancers Prefer APMs

The main reasons freelancers flock to alternative payment methods are flexibility, borderless payments, and low fees. With the major inhibitions posed by traditional banks avoided, freelancers can easily bid for more gigs and present themselves to more clients without fear of losing.

In addition, APMs allow you to attract new customers. Customers will be more willing to give you a chance when payments are easy and painless, especially when it comes to international transactions.

The Downside of APMs

APMs are not without drawbacks, the most obvious being transaction fees. For example, Neteller charges around 10% for withdrawals. There is also the possibility of delayed transactions.

Some payment systems can hold your money for six to seven days, which can be frustrating, especially if the money is needed urgently. Finally, some payment methods are not available in all countries. Venmo, for example, is only available in the US

Choose an APM that’s right for you

There’s a lot of debate about using alternative payment methods as a freelancer today, although the pros far outweigh the cons. Still, before choosing one, make sure you understand their terms of engagement, coverage, availability, fees, customer support system, and more.

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