Remote working offers various benefits to workers. It provides a level of flexibility that isn’t available to contracted employees, and it enables skilled individuals to work for employers around the world without having to relocate or make regular trips to the business.
However, it also raises some challenges, such as finding the best way to get paid. The payment method has to be accessible, flexible, and provide timely and affordable options to the business and the individual.
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Cryptocurrency
Cryptocurrency was introduced to the world following the launch of Bitcoin in 2009. In recent years, it has become a popular investment vehicle, with investors looking for the next 1000x crypto. According to Camila Karam, these coins have a strong potential for massive gains in market capitalization. They also show strong use cases, have existing strategic partnerships in place, and are the most likely to be listed on centralized exchanges: a combination that can result in significant price and market cap gains.
Cryptocurrencies can also be used as a means of transferring payment from one party to another.
Pros
Fast Payments – Cryptocurrency payments are borderless and can be processed in a matter of minutes. This means the recipient is not left waiting for payment or worrying about whether they will receive their remittance.
Borderless Transactions – Cryptocurrency is a borderless currency. Payments cost the same and take as long whether they are sent across the world or down the street.
Low Fees – Low transaction fees associated with cryptocurrency are appealing, and it is the sender who typically has to pay the initial fees. Recipients may have to pay fees to convert or sell crypto, but these are lower than traditional exchange fees.
Cons
Additional Steps Required – Although it is becoming more commonplace, cryptocurrency is not widely accepted. Users typically have to convert or sell their crypto before they can spend it.
Not Widely Used – More and more businesses are accepting and using crypto, but many businesses still shy away from its use due to volatile prices and its higher degree of difficulty.
Additional Security Considerations – Human errors can lead to the loss of crypto payments, while theft, hacks, and scams are still seen in the crypto market.
Digital Wallets
Digital wallets like PayPal and Venmo are convenient, and there are many more global payment apps now available. They typically include mobile apps that can be installed on phones and are widely accepted by online businesses and e-commerce stores, at least.
Pros
Convenient – Wallets like PayPal can be used online via browsers, and they also include apps that can be installed on cell phones and other mobile devices. Their widespread availability and increasingly advanced features make them beneficial to users.
Secure Payments – Digital wallets are built with security in mind, and they offer an additional layer between a user’s payment and their bank account. This enhances security and helps protect balances.
Cons
Additional Steps Required – Like cryptocurrency, additional steps are typically required to be able to access money in a digital wallet. Currency might need to be converted before it can be sent to a bank account.
High Fees – There are numerous fees involved in the use of digital wallets. As well as transaction fees, wallet providers will charge conversion fees for exchanging currencies, and some also use high exchange rates.
Payment Platforms
Payment platforms offer some of the benefits of standard bank accounts with the convenience of digital wallets. Wise has become a very popular payment platform and its reach continues to increase as it is offered in more countries.
Pros
Lower Transaction Fees – Dedicated payment platforms generally have lower transaction fees and better conversion rates than digital wallets because they are designed for remittances and payments.
Fast Payment Times – Sending payment from one account to another is usually instant, although there may be some delays depending on the payment method used by the sender.
Can Provide Basic Banking Features – Many of these platforms operate similarly to bank accounts. Users can set up direct debits and standing orders, pay bills, and even get debit cards for their accounts.
Cons
Available In Limited Countries – Compared to cryptocurrencies and digital wallets, individual payment platforms are not usually available in as many countries. Wise is widely accepted, available in 160 countries, but PayPal is available in 200 or more, and Wise is something of the exception.
Still Attracts Conversion Fees – While transaction fees might be low, conversion fees still exist and these can be high with some platforms and certain currency pairings.
Freelance Marketplace Platforms
Freelance marketplaces connect freelancers and customers. Some freelancers conduct all of their marketing, connection, customer communication, and even payment business through platforms like Upwork and Fiverr.
Pros
Escrowed Payments – Arguably the biggest benefit of using a freelance marketplace for payments is that the buyer typically has to escrow payment before work commences, and the money is released once the freelancer completes the work or reaches agreed milestones.
Conflict Resolution – The platform will also act as a mediator or judge when there are conflicts between businesses and freelancers. This can help protect the freelancer’s business.
Choice Of Withdrawal Methods – Once the user has received payment, they do need to be able to withdraw the money to access it. Most platforms offer digital wallets, bank accounts, and even bank card withdrawals.
Cons
Fees Can Be Very High – Most marketplaces charge high fees, some of which are met by the freelancer. These fees come on top of any digital wallet or bank transfer fees. Individuals need to account for these payments in their calculations and budgets.
Limited Use – Not all businesses do or want to conduct their freelance hiring and use through marketplace platforms. It might be necessary to try and convince clients to get on board, but some won’t change their methods.
Bank Transfers
Bank transfers are widely considered the original method of remote worker payment. The majority of people, although certainly not everybody, have bank accounts, and the majority of these accounts offer bank transfer features. However, while this is the traditional method of payment, some might argue that bank transfers have been replaced because they have become outdated.
Pros
High Levels Of Security – Banks have invested large sums of money in security to ensure that payers and payees can transact securely. Although bank transfers do not have the same high level of security as credit cards, payments are still secure.
Widespread Acceptance – Although 1.5 billion people in the world have no or only basic banking features, the majority do have some form of bank account, which makes bank transfers accessible.
Convenient – Bank accounts are usually people’s main method of making payments and storing money. Receiving money into a bank account is, therefore, the most convenient option.
Cons
Potentially High Fees – Banks charge fees for a lot of bank transfers, especially those to overseas accounts. Additional charges are levied for fast payments and payments in different currencies. The fees can prove a lot higher than with other payment methods.
Slow Transaction Times – Although most countries have some banking system that allows instant payments to and from accounts within their borders, this isn’t always the case, and overseas payments can take several working days.
Conclusion
Choosing the best payment method is important for remote workers because it affects revenue and profits, as well as cash flow and cash availability.
While bank transfers are considered the traditional means of accepting money, methods like digital wallets and even cryptocurrency are becoming increasingly commonplace thanks to the lower cost and increased flexibility they offer.
