Poll: Have you ever used money transfer websites to avoid bank fees on foreign currency payments received?
Thread poster: ProZ.com Staff

ProZ.com Staff
Local time: 06:16
SITE STAFF
May 17, 2016

This forum topic is for the discussion of the poll question "Have you ever used money transfer websites to avoid bank fees on foreign currency payments received?".

This poll was originally submitted by Ed Ashley. View the poll results »



 

Béatrice DEZERALD  Identity Verified
France
Local time: 15:16
Member (2008)
English to French
+ ...
Yes, but... May 17, 2016

I don't use them anymore because there are fees with these sites too !

 

Teresa Borges
Portugal
Local time: 14:16
Member (2007)
English to Portuguese
+ ...
No May 17, 2016

I have always avoided Paypal and the like as much as possible, since they are expensive. All my clients pay per bank transfer. I live in Portugal and all my regular clients are in the Euro zone, where bank transfer fees are low.

 

neilmac  Identity Verified
Spain
Local time: 15:16
Spanish to English
+ ...
Other May 17, 2016

AFAIK, this is more of an issue for translators working with US-based agencies or clients. As all of my clients are based in the EU, it's not a problem. I have one online e-banking account and there is no charge for transfers received. The commissions for outgoing transfers are reasonably low and there are options for splitting charges with the recipient.

I do use Paypal to pay for things like software licenses or online purchases, and may have received a couple of payments that way
... See more
AFAIK, this is more of an issue for translators working with US-based agencies or clients. As all of my clients are based in the EU, it's not a problem. I have one online e-banking account and there is no charge for transfers received. The commissions for outgoing transfers are reasonably low and there are options for splitting charges with the recipient.

I do use Paypal to pay for things like software licenses or online purchases, and may have received a couple of payments that way over the years, but normally it isn't necessary.

PS: I don't understand the comment that "Paypal is expensive"... as far as I know, any fees I pay for it are minimal compared to what some banks charge as a matter of course.


[Edited at 2016-05-17 08:51 GMT]

According to this link, the normal charge is 2-3%. Is that a lot? (serious question)

http://alexisgrant.com/2014/12/05/avoid-high-paypal-fees/

[Edited at 2016-05-17 08:59 GMT]
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Mario Chavez (X)  Identity Verified
Local time: 09:16
English to Spanish
+ ...
Oh, those transfer fees! May 17, 2016

I recently had to send a payment to a university in Lisbon, Portugal. Their official instructions for making a 51 euro enrollment (candidatura) fee to a PhD program included steps to do a bank wire transfer.

a) My local bank, with branches in at least 2 states (America) charges 45 dollars per each transfer. Fortunately, they couldn't do it for some technical reason.
b) Another of my banks (where I have an investment account) offers the easiest transfers internationally
... See more
I recently had to send a payment to a university in Lisbon, Portugal. Their official instructions for making a 51 euro enrollment (candidatura) fee to a PhD program included steps to do a bank wire transfer.

a) My local bank, with branches in at least 2 states (America) charges 45 dollars per each transfer. Fortunately, they couldn't do it for some technical reason.
b) Another of my banks (where I have an investment account) offers the easiest transfers internationally for a 25 dollar fee. Still, they stumbled on a technical issue.
c) I asked the Lisbon school for an alternative like Paypal; they said yes and gave me the instructions. Paypal charged me less than one dollar for the transfer of 51 euros. A pretty sweet deal!

I remember working for Amazon once and they sent me a $200 payment to my local bank. The funds came from their Costa Rican offices but it took me months to receive it, not because Amazon was late but because my bank didn't spot the transfer!

As Neilmac pointed out, this is more an issue with us Americans living in the USA. For local transfers, there are no fees if any. But they hit us with the hefty charges (see a and b above) otherwise.
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Michael Harris  Identity Verified
Germany
Local time: 15:16
Member (2006)
German to English
Yes May 17, 2016

And both of us were happy.

I was recommended transferwise and was really surprised how much money the person abroad receiving saved in costs

For all other transfers within Europe, I just use SEPA, it is free of charge


 

Michael Harris  Identity Verified
Germany
Local time: 15:16
Member (2006)
German to English
Bank fees are low? May 17, 2016

Teresa Borges wrote:

I live in Portugal and all my regular clients are in the Euro zone, where bank transfer fees are low.


There shouldnt be any fees at all, for both parties.


 

Muriel Vasconcellos  Identity Verified
United States
Local time: 06:16
Member (2003)
Spanish to English
+ ...
I said No ... May 17, 2016

because I didn't think it was referring to PayPal. Their fees and foreign currency charges are higher than the banks'. I do accept payment by PayPal in a pinch, but I urge my clients to use another form. The cheapest for me is a check in USD.

 

José Henrique Lamensdorf  Identity Verified
Brazil
Local time: 11:16
English to Portuguese
+ ...
In memoriam
Yes, some of them May 17, 2016

PayPal

Good only for small amounts, as they charge a percentage of the total involved.
Payers love it, because they are owned by and intended for eBay, so they don't charge anything from them.
First, they deduct 6.5% in fees from whatever I receive on arrival.
Then, if I request them to convert my balance (or any part thereof) into my local currency (BRL) and transfer that to my bank account in Brazil, they o
... See more
PayPal

Good only for small amounts, as they charge a percentage of the total involved.
Payers love it, because they are owned by and intended for eBay, so they don't charge anything from them.
First, they deduct 6.5% in fees from whatever I receive on arrival.
Then, if I request them to convert my balance (or any part thereof) into my local currency (BRL) and transfer that to my bank account in Brazil, they overtly adopt a 3.5% lower-than-market exchange rate.
The cherry on the top is that they take 2-5 business days to transfer the funds to my account. From my experience, usually 3 business days to USD>BRL>BR bank, and 5 business days to BRL>BR bank.
Bottom line, PayPal costs 10% of the entire amount, plus an avg. 4-day delay.

Receiving an international bank transfer at my bank in Brazil (Itau) costs a BRL 100 (~USD 30) flat fee per transaction. Some clients let me choose between "free" PayPal and a US$20~50 fee (on their side, for sending) for bank transfers. Though the second option is "unfair", it's common practice in the translation marketplace.

AFAIK in Brazil HSBC charges BRL 300 (i.e. 3x what Itau does) for receiving a wire, so fees may vary significantly. The time to receive a wire transfer is random, from one hour (record so far) to 5 business days.

Assuming that my total expense in receiving a wire transfer would be $30 + $ 20 = $50, this would set the PayPal vs. wire break-even at USD 500. If the amount is lower, use PayPal; if higher, go for a bank transfer (please do YOUR LOCAL math!).


Moneygram, Western Union - aka P2P services.

These are NOT intended for "business". They entail someone at the client getting the money in cash on the translator's behalf, and then sending the payment as a private individual. Most accountants take a dim view of that.

This practice is deemed acceptable by some small agencies, and definitely banned from large operations, where it's easy for loose money to "vanish", and the agency gets the blame.

Cost is quite attractive, usually USD 5 for payment from a bank account, USD 10 from a credit card, for amounts up to USD 3,000. Speed too. If the payer does everything right, the money will be available for pickup by the payee in less than one hour.
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Mario Chavez (X)  Identity Verified
Local time: 09:16
English to Spanish
+ ...
Has anyone used the hawala system? May 17, 2016

I've read in the papers about how some Muslims make payments via the hawala system. Since it's a money transfer outside of the banking or financial systems, both the payor and the beneficiary aren't identifiable in the hawala.

 

Inca Vallès  Identity Verified
Spain
Local time: 15:16
Member (2014)
French to Spanish
+ ...
Yes May 17, 2016

For me, since I am based in the Eurozone, option one is a SEPA transfer. Option 2 is Transferwise (at zero cost for me and at a very low cost for the sender). Option 3 is PayPal (I don't like it because the fees are high but some clients only use PayPal).

 

DianeGM  Identity Verified
Local time: 16:16
Member (2006)
Dutch to English
+ ...
Yes ... May 17, 2016

I have a few client who pay by Paypal, but that is the only one I use.
I also have foreign currency accounts one to accept USD and one for GBP.
Otherwise the charges were annoying.


 

Nilton Junior  Identity Verified
Brazil
Local time: 11:16
Member (2009)
English to Portuguese
+ ...
US bank account & TransferWise May 17, 2016

Inca Vallès wrote:

For me, since I am based in the Eurozone, option one is a SEPA transfer. Option 2 is Transferwise (at zero cost for me and at a very low cost for the sender). Option 3 is PayPal (I don't like it because the fees are high but some clients only use PayPal).


TransferWise was not around a few years ago, so I decided it would be easier to open a bank account in the US as most of my clients are based there. I rely on TransferWise (or Xoom from time to time) to make transfers to my Brazilian bank account when I need money or when the exchange rate works in my favor.


 

Mario Freitas  Identity Verified
Brazil
Local time: 11:16
Member (2014)
English to Portuguese
+ ...
Yes May 18, 2016

In Brazil, bank transfers from abroad are totally impracticable. The fees are abusive, the terms are abusive, and the bureaucracy is abusive. I am currently refusing jobs if the client only pays through international bank transfer.

José Henrique: You forgot that the same 3.5% (actually 4.5%) spread when you convert USD into BRL in PayPal apply to the bank transfer, in addition to the BRL 100 fee. Or do you think the bank works with a better exchange rate than PayPal? So, considerin
... See more
In Brazil, bank transfers from abroad are totally impracticable. The fees are abusive, the terms are abusive, and the bureaucracy is abusive. I am currently refusing jobs if the client only pays through international bank transfer.

José Henrique: You forgot that the same 3.5% (actually 4.5%) spread when you convert USD into BRL in PayPal apply to the bank transfer, in addition to the BRL 100 fee. Or do you think the bank works with a better exchange rate than PayPal? So, considering the 6.5% fee (actually 6%) charged by PayPal, any amount below USD 475 would be better received throught PayPal (not considering the item below).

Now, remember there is a new law of the Brazilian Federal Revenue that anything that enters your
account above 2000 BRL within a month is informed to them? The implications of this law (you know them) would escalate these USD 475 to... how much? A lot more than we usually receive from clients on a monthly basis, I'd say.

[Edited at 2016-05-18 16:47 GMT]
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