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PayPal is the standard online payment system for both selling and buying. It is very convenient, instantaneous and secure, that’s why it is expensive.

It can cost us up to 3.4% out of the money we receive depending on the country where you live, plus a 2.5% to convert the money to your local currency, so you might end up paying 600US$ for every 10.000US$ you get.

Pieces of advice to save money with PayPal

• Use a personal account instead of a professional one; they don’t have fees, but they have lots of limitations when it comes to move the money.
• Withdraw your money when the US$ is strong.
• Send your payments as a personal transaction instead of doing it as a purchase; you will pay a few cents, but the recipient will not pay anything.
• Send your payments using the mass pay option; you will pay up to 1US$ tops, but the recipient will get it for free.
• Use the cheapest online banking (see below).
• Check your monthly volume to access better fees:

Money Bookers

Advantages:

• It reaches some countries that PayPal doesn’t.
• It is very inexpensive:
  • Send money costs a maximum of 0.75US$.
  • Receiving money is free.
  • Withdrawing money costs a maximum of 5.24US$.
  • The money conversion into your local currency costs 2%.

Disadvantages:

• It is not well known, needless to say that imposing an unknown form of payment to your customers is like giving them a good reason to hire someone else, to delay the order or to never call us again.
• They say they offer support in almost any language, but it is limited to their web, customer support uses English only.

Epassporte

Advantages:

• They offer you a virtual Visa credit card (to be used online only) for free.
• It is pretty know for transactions with adult content.
• It is very inexpensive:
  • To send money costs between 0.3 -1 US$ per transaction.
  • Receiving money is free.
  • Withdrawing money costs 3US$ for US residents and 50US$ for Europeans.

Disadvantages:

• This system is not well known.
• Their website is very confusing and difficult to navigate.
• Their customer service is bad.
• To transfer your money to European accounts you have to pay 50US$, also you have to request the transfer to be done in your name, which often takes a long time (last time it took a month).

Western Union

Advantages:

• It is less expensive than PayPal.
• It reaches lots of countries in which PayPal doesn’t.

Disadvantages:

• It is not as instantaneous as the rest of the online forms of payment.
• It is more expensive than Money Bookers and Epassporte.
• You have to personally go to their offices, wait in line and fill out forms. We have the online option, but it is a lot more expensive.

Fighting the US$ devaluation

Workers outside the United States have an additional problem that is the devaluation of the dollar, currency in which most online transactions are done.

The ideal would be to be able to withdraw our US$ from PayPal, Money Bookers or any other system you use, into a local bank account and wait until it revaluates. That way we have our money secure and in hand in case we need it, but I’m afraid it doesn’t matter which system you use; you will not be able to withdraw your money in a currency other than your country’s currency.

So, either you:

• Spend your US$ in US shops.
• Keep your US$ in your virtual bank until the US$ revaluates, which might take months, even years.
• Withdraw your US$ into your local bank, subsequently loosing money.
• Create a new bank account in the USA, where you will transfer your US$, which is not very practical and might not even be possible.

None of these alternatives are good, but we have another option which we’ll see next.

Multicurrency Bank Accounts

The only way to keep your US$ in a bank account outside the USA is by opening a multicurrency account in our local bank. Actually, it is two linked bank accounts, one in US$ and the other one in your country’s currency, and they work like any other bank account.

Advantages

• They are usually very inexpensive, they only charge a fee to receive the money, which usually is less than 10US$ (check with your local bank).
• You have the security and all the guarantees of having the money in a local bank.
• You can keep your US dollars until they revaluate.
• You can instantaneously convert them to Euros whenever you need them.

Disadvantages:

• International transfers may take 3 – 4 days.
• You need much more information to be able to make a transfer.

Conclusion

The best you can do is to get familiar with each one of the payment systems mentioned above, and offer several options to your customers, organized by preference; in my case it would be like this:

• My first option would be a transfer in US$ to my multicurrency bank account.
• If the customer is in a hurry or the amount is very small, I would offer the Money Bookers option.
• In case that the customer doesn’t have an account with Money Bookers and if I see that the order could be in danger, then I would offer PayPal.
• In case that PayPal is not available in their country, I would use Western Union.
• I would only use Epassporte to receive payments from work with adult content.