As a freelancer, there are more payment methods than ever before, and they provide secure, reliable, and fast ways to get money from your client to your bank account.
To help you pick the right one, we’re breaking down eight of the best payment methods for freelancers in 2023. You’ll learn about each pick, fees, important features, and how to decide which is best for your business.
Which Payment Method is Best for Freelancers?
We've reviewed the options, and here are our top picks for 2023:
PayPal has been one of the most popular payment methods for freelancers for at least a decade, and there are over 220 million active accounts around the globe. It’s free to create a PayPal account, and setting it up takes just a few minutes, but be ready with your bank account information to quickly move through the sign-up process.
- Freelancers can accept payments and transfer the funds to their bank account in 1 day, but it can take between 3-5 days depending on your bank’s clearing process.
- PayPal charges 3.49% plus 49¢ per transaction for digital payments (PayPal, Venmo, cryptocurrency).
Payoneer is a payment platform designed to allow merchants (freelancers in this case) to send and receive payments without a merchant account. You can’t directly bill customers, but you can request payments through the platform. It’s a solid alternative to PayPal, and you can accept domestic and global client payments. There are no fees to set up an account or monthly fees, unless you’re inactive for over 12 months.
- There is a 3% fee for credit card transactions, 1% fee for ACH bank debit transactions, and 0% fee to receive payments from other Payoneer users.
- To transfer money from Payoneer to your bank account, it takes 2-5 days with a $1.50 transfer fee.
M$M tip: Check out these articles for more helpful information if you’re self employed: Best Self-Employed Retirement Plans and Best SEP IRA Providers for 2023.
3. Google Pay
Google Pay is the replacement for Google Wallet, and you can use it to send and receive funds. It’s an incredibly convenient payment method for freelancers. It’s free to set up your account, and you can connect your bank account in just a few minutes. Google Pay stands out mostly because there are no fees for businesses.
- There are no fees to set up an account or accept business or commercial payments and deposits.
- There are transfer fees to move money out of Google Pay to a debit card or bank account — 1.5% or $0.31 if you are transferring less than $20.70, and transfers take 1-3 business days.
Venmo is a peer-to-peer payment platform that’s actually owned by PayPal. It’s mainly intended to send money between family and friends, but it can be used as a payment method for freelancers. There’s no cost to set up an account, and account holders are given a unique QR code and username used to accept payments. The biggest downside is there is a $299 limit to how much money you can move around, but your limit is raised to $2,999 once you’ve confirmed your identity using the last four digits of your SSN or by connecting a Facebook account.
- It’s free to send and receive payments on Venmo, but there is a 3% fee to send money via credit card. Receiving money is always free.
- When you transfer money from Venmo to your bank account, standard transactions are free and take 2-5 business days. Instant Transfers happen the same day and come with a 1% fee or $10 maximum charge.
FreshBooks is invoicing software for small business owners, and it has built-in payment processing functionality that makes it a one-stop solution for freelancers. You can create and send invoices, accept credit card and bank transfer payments, track sales tax, and see reports. Overall, it’s well-respected bookkeeping software that can be an excellent payment method for freelancers. However, there is a monthly or annual fee to use FreshBooks, but remember it has more than payment features.
- FreshBooks starts at $17.00 a month for the Lite plan, and there are usually discounts for the first six months.
- The Lite plan allows you to send unlimited invoices for up to 5 clients, so you may need to upgrade if you have more than 5 clients. The next level up, Plus, is $30 a month and has additional features like double-entry accounting, unlimited invoicing for up to 50 clients, business health reports, mileage tracking, and more.
6. Wire Transfer
This is one of the best payment methods for freelancers if you don’t want to deal with a third-party system. Wire transfers involve the client bringing information to their bank and sending money, and the transfer instructions come from the sender. That means you’ll have to provide your client with the account name, account number, and bank details. The benefit is security (other than giving your client sensitive information) and fast transaction time — max of 3 days in most cases.
- Wire transfers can have fees ranging from $0 to $50 depending on the bank.
- Not the most ideal payment method for small projects because of the cost.
Yes, some freelancers and clients still operate using old-fashioned paper checks, and that’s perfectly okay. Checks are one of the cheapest ways to accept payments if you’re a self-employed worker. But because checks take time to mail and then you have to deposit the check, they’re generally not the favored method of payment. There are also security concerns with checks because all of the payer’s information is written on the check.
- Widely known as the most affordable way to accept payments as a freelancer, and the only cost comes from buying new checks.
- Most banking apps have a mobile deposit feature so you don’t have to drive to the bank to deposit your checks.
8. Freelancer Services Marketplace
Our last payment method for freelancers isn’t a dedicated payment method. We’re talking about platforms where freelancers can find jobs and get paid all in one place — like Fiverr and Upwork. Each marketplace has its own fee structure, and most take a percentage of your payment, but the benefit is that you can list your services in a place where clients are actively going to hire freelancers. Then, the platform manages payments so you don’t need a third-party system.
- Most freelancer marketplaces also handle tax compliance for you.
- Because you’re competing with a large number of freelancers, it can be difficult for new freelancers to build their client base.
How to Choose Which Payment Method as a Freelancer?
We’ve just covered more than half a dozen different payment methods you can use for your freelance business or side hustle, but how do you tell which is the right one for you.
Here are the factors you should consider when choosing a freelance payment method:
- Fees: Most third-party payment systems charge you fees for transferring money quickly out of your account, and some also charge the sender fees. Also, be aware of any changes that the platforms make to their fees, and be willing to switch if the costs get to be too high.
- Additional features: If you’re a freelancer who also accepts in-person payments, you’ll want to look for a system that allows that as an option.
- Ease-of-use: Think about how easy it is to set up your account, create invoices, transfer money out of your account, and how easy it is for your client to pay you. Most software is very user-friendly, but it’s still worth considering.
- Security: Because you’re dealing with payments and sensitive bank account information, security is of the utmost concern for you and your clients. All of the options in this list are safe. Even paper checks, while not everyone wants to share a check because of the details they contain, they are still safe overall.
- Support: Strong customer support is critical if you ever have a payment issue. You can get a better idea of how each system resolves concerns by looking at platform reviews online.
The Final Word on Best Payment Methods for Freelancers in 2023
Whether you’re a brand new freelancer or a seasoned one looking for payment solutions, all of the options on this list are great choices. As a freelancer, I can say that the fees are what you have to pay the closest attention to when you’re picking one. Fees eat into your take-home pay, but remember, you can write them off at tax time.
Yes, you can use Venmo to accept payment for freelance work, and Venmo is actually owned by PayPal. Because of its intuitive app, it’s a great choice if you’re on-the-go and need to accept payments.
Third-party payment systems like PayPal, Venmo, Payoneer, or Google Pay are secure and widely available. They are easy to set up, and it’s convenient and secure way for your clients to send money and for you to transfer it to your bank account.