Last editedAug 20237 min read
Payment methods for freelancers encompass various digital and traditional monetary transactions designed to accommodate the unique financial needs of independent professionals. In the UK, popular methods include bank payments, which offers a secure, efficient, and automated way to receive recurring payments, and credit or debit card payments, known for their ubiquity and ease of use.
Getting paid as a freelancer has never been easier, and you no longer need to rely on inconvenient and time-consuming bank transfers or cheques. Regarding getting paid as a freelancer, there are two payment methods: bank and card payments.
Card payments have been the “go-to” option for many years, but bank payments can prove a better option for many freelancers. Even though, realistically, there are only two options when it comes to payment methods (card payments or bank payments), freelancers can choose between many providers. However, it's important to remember that the payment method will dictate many of the features and associated costs.
Here we will highlight six of the best freelance payment methods, though which one is the best will depend on each individual and their circumstances.
The best payment providers for freelancers described below include:
Top freelance payment portals
The following freelance payment portals offer something different, but making it easy to accept payments remains their core offering. Depending on your exact circumstance, a particular service may be more suitable for you than another, for example:
if you need to keep transaction fees down
if you need to accept payment internationally
if you need additional features beyond the ability to accept payments
Keep reading to find your best payment providers for freelancers:
GoCardless offers a bank payment service that always gets you paid on time and is more affordable and secure than accepting card payments. You can easily accept one-off and recurring payments, and both can be done very easily from your client's point of view by sending them a payment request link via email, text, or hosting it on your website. Using our Instant Bank Pay feature, you receive instant confirmation when your client authorises the payment through an easy-to-use flow on their device, and then the funds arrive in your account shortly afterwards.
Additional features include the online merchant dashboard, which makes it easy to set payments up in just a few clicks, invoice creation, and the ability to save time on payment admin by automating payment collection and reconciliation via over 350 software integrations, including QuickBooks, Xero, and Zuora.
PayPal is a payment gateway that always comes up in the conversation about the best payment method for freelancers as it is a quick and easy way for clients to make payments. It is well known worldwide and is likely to be an acceptable form of payment for freelance work. A fee is paid per payment into your PayPal account, though transferring money from your PayPal account to your bank account is free.
If paying fees for transactions isn’t viable for you, then Google Pay might be the answer. Created by the unification of Android Pay and Google Wallet in 2018, Google Pay is potentially one of the most convenient payment options for freelancers. However, it has limited online payment partners, so some clients may prefer another payment method.
FreshBooks is a popular invoicing software solution that allows for quick and easy invoice creation and can send automatic payment reminder emails to clients.
Escrow is the best freelance payment portal for freelancers concerned about getting paid for their work, such as those constantly working with new or unknown clients. Escrow requires the client to pay before the freelancer starts work and deposit it in the freelancer’s account when the work is complete. Also, note that Escrow’s transaction fee is relatively high compared to other payment options for freelancers.
Stripe is an interesting freelance payment method as it is less well known than PayPal and Google Pay, but it is easy for both the client and freelancer. Their fees are high, and even though it is possible to collect bank payments, their main focus is still on card payments. Though you get decent convenience for the cost, they are a secure online payment option for freelance workers.
Another freelance payment portal that is not as widely used as others on this list but is still worth considering if the clients are willing is Skrill. Previously known as Moneybookers, Skrill is ideal for freelancers regularly working with international clients, as its main focus is on making worldwide transfers via different currencies.
Paymo offers a little more than just a freelance payment portal, as it has a project tracking feature that lets you schedule payments and compile reports. It also has an invoicing feature which can be very useful for freelancers who don’t have that option elsewhere.
Freelance payment portal considerations
There are several considerations that freelancers should bear in mind when choosing their preferred payment option.
First, always look at the fees involved and how this will affect how much you receive for your work. There may also be a fee structure where the fees are higher for transactions above a certain amount. Usually, bank payments are the cheaper option since it’s a direct transfer between two bank accounts, cutting out all the intermediaries in card payment networks.
Ease of use
The next consideration should be convenience for yourself and your client. If you have a freelance payment method that is awkward, time-consuming, or unknown to a client, they may be reluctant to use it. Even though card payments are a well-known collection method, they can cause friction due to different networks (VISA, Mastercard, Maestro, etc.), resulting in less than desired transparency regarding costs and fees.
Despite their initial appeal, card payments carry a heightened risk of failure. This is predominantly due to circumstances such as lost, expired, stolen, or cancelled cards which significantly hamper successful transactions. The inconvenience this causes disrupts the cash flow and poses challenges in maintaining seamless customer experiences.
On the contrary, bank payments, like the ones facilitated through GoCardless, sidestep these issues altogether. A bank account doesn't get lost or stolen, guaranteeing a substantial reduction in failure rates. Moreover, GoCardless goes the extra mile, providing a service to retry collections if any problems arise initially. This proactive approach further bolsters the success rate of payment collection, thereby ensuring more reliable, efficient, and user-friendly transactions.
Security is also very important, so make sure any freelance payment portal you use is a secure and established payment channel. Both methods offer great security, with numerous fail-safes in place to ensure you and your customer are safe and any transaction is processed most securely.
You can also check what kind of customer service and support each payment portal offers. See if they have a live chat or another quick way to communicate, as this will make solving any issues much easier.
We can help freelancers get paid
GoCardless offers an affordable, reliable, and secure payment collection service that can automate payment collection saving you time, money and stress. With GoCardless you can quickly and easily set up plans to collect a variety of payments.
Invoice payments can guarantee that your business keeps a positive cash flow, with invoices being sent and collected automatically, saving you time and money on payment collection.
Recurring payments help streamline and scale your business, allowing you to collect regular payments from your customers on the exact dates set by you.
Instant Bank Pay is an excellent alternative when trying to replace card payments. The instant confirmation of funds is one of the main benefits, with the money usually available within 24 - 48 hours.
Direct Debit payments can help a business save time and money while guaranteeing a good cash flow. By setting Direct Debit payments, businesses can greatly reduce the time spent chasing payments and their failure rate.
Card payment networks have many intermediaries, resulting in much higher costs since each one needs to charge a fee for their services. That is not the case with bank payments, with all transactions between two bank accounts.
That is the most important reason that allows bank payments to be a more reliable and affordable alternative to card payments.
Case study: freelancer payments
Frankie G Clark, a personal trainer based in Northumberland, England, was able to leverage GoCardless Instant Bank Pay to simplify her payments process and expand her freelance fitness business.
Frankie was initially overwhelmed by the administration of managing payments for her growing client base. After integrating GoCardless with TeamUp, a cloud-based calendar app, she found that it removed the stress of payments, streamlined her invoicing process, and improved her cash flow management.
Moreover, the introduction of GoCardless Instant Bank Pay gave Frankie instant access to funds, which provided a more up-to-date picture of her finances. She said, “Instant Bank Pay is great when you're self-employed because the funds arrive right away – there’s no lag, so that side of the finances is always up to date.”
This case study highlights the benefits of using bank payments over card payments for freelancers. GoCardless provides immediate payment collection, reduced administration time, and improved business planning and visibility over financials. Frankie’s experience also underlines how reliable and automated payment solutions can provide better cash flow management, increasing financial stability for freelancers.
As Frankie concludes,
We can help
Setting up payment collection is fast and efficient with GoCardless. By automating the payment collection process, GoCardless drastically cuts down the administrative responsibilities of managing and tracking invoices for your team.
GoCardless makes it quick and easy to get started with no contracts or long-term commitment required. You can set up instant, one-off, or recurring payments in the merchant dashboard in just a few clicks. GoCardless automatically creates and sends all the necessary forms, doing all the heavy lifting for you. You can connect to GoCardless via over 350 partner apps like Xero and Quickbooks.
Discover how GoCardless can automate payment collection, making it easier to concentrate on what matters most - your business growth.
Frequently Asked Questions — FAQs
What payment method do freelancers use?
Freelancers often prefer a combination of Direct Debit and card payments when selecting a payment method. Direct Debit offers a convenient and reliable option, allowing freelancers to set up recurring payments with their clients, ensuring a steady cash flow. Additionally, card payments provide flexibility and accessibility, enabling freelancers to accept payments swiftly and securely, both online and offline.
By utilising a combination of Direct Debit and card payments, freelancers can optimise their cash management processes, enhance client satisfaction, and streamline their overall payment experience.
How should you accept payment as a freelancer?
When accepting payments as a freelancer, adopting a diversified approach that caters to the preferences and convenience of both you and your clients is crucial. Two highly recommended payment methods for freelancers in the UK are Direct Debit and card payments. Direct Debit provides a seamless and automated way to receive recurring payments from clients, ensuring a consistent cash flow and reducing administrative burdens.
By leveraging Direct Debit, freelancers can establish long-term relationships with clients and focus more on delivering their services. Additionally, card payments offer flexibility and accessibility, allowing freelancers to accept one-time payments conveniently.
Integrating card payment options, whether through online payment gateways or mobile point-of-sale solutions, empower freelancers to accept payments swiftly and securely, catering to the preferences of tech-savvy clients.
By combining Direct Debit and card payments, freelancers can optimise payment processes, enhance client satisfaction, and foster a thriving freelance business.