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Agency charging fees for payment - is this normal practice?
Thread poster: John Gamble

John Gamble  Identity Verified
Local time: 03:26
Swedish to English
Apr 11

Hi,

I'm based in the UK and have recently been offered freelance work with a large, well-known translation agency based in the USA. They want to pay me in US dollars, but will make a charge for doing so if the payment is by bank transfer or Paypal. The charges are $20 for each bank transfer, or $10 for each Paypal transfer. Cheques are free, but then my UK bank would make charges for that.

There is an option to defer payment until a certain sum accumulates, in order to reduce the number of transactions and therefore fees. However, as I'm a small-scale business, I need to have a regular cash-flow, so this option is not attractive to me.

What I wanted to ask is:

1). Is charging for payment, as described above, a standard practice within the translation industry? I've never come across this before, but I admit, I haven't until now worked with many overseas clients. I'm not very happy about it, but am not sure what can be done.

2). What would be the best way to arrange for overseas payments for translation work? It would be helpful to know what other people do in these circumstances.

Many thanks for any advice given.

Best wishes,

John


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Lingua 5B  Identity Verified
Bosnia and Herzegovina
Local time: 04:26
English to Croatian
+ ...
Overseas payments. Apr 11

John Gamble wrote:

Hi,

I'm based in the UK and have recently been offered freelance work with a large, well-known translation agency based in the USA. They want to pay me in US dollars, but will make a charge for doing so if the payment is by bank transfer or Paypal. The charges are $20 for each bank transfer, or $10 for each Paypal transfer. Cheques are free, but then my UK bank would make charges for that.

There is an option to defer payment until a certain sum accumulates, in order to reduce the number of transactions and therefore fees. However, as I'm a small-scale business, I need to have a regular cash-flow, so this option is not attractive to me.

What I wanted to ask is:

1). Is charging for payment, as described above, a standard practice within the translation industry? I've never come across this before, but I admit, I haven't until now worked with many overseas clients. I'm not very happy about it, but am not sure what can be done.

2). What would be the best way to arrange for overseas payments for translation work? It would be helpful to know what other people do in these circumstances.

Many thanks for any advice given.

Best wishes,

John


Yes, it's often the case with overseas payments, some clients find a way to reduce fees (there are many online payment services out there).

Having a minimum order or project rate is helpful, ie. $10-20 fee won't hurt you that much on a $1,500+ project.

How big are your payment totals typically? If you are still taking on small projects, wait until they build up until a certain total, then ask for a transfer. I can't see any other way, of course a bank will take their charge on all transfers, and especially small transfers which banks don't enjoy and will charge their costs accordingly.


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Thayenga  Identity Verified
Germany
Local time: 04:26
Member (2009)
English to German
+ ...
Hm Apr 11

So they want to charge $ 10 for transferring your money to PayPal? Well, PayPal will also charge you between 4 - 10% of the amount received. This means that you will be paying fees twice while the agency pays exactly $ 0.00 in fees.

As a small business you need to include all of your expenses in your rate, so I hope you charge at least $ 0.14 per source word.


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Vladimir Pochinov  Identity Verified
Russian Federation
Local time: 04:26
Member (2002)
English to Russian
Raise you rate slightly to absorb any similar charges Apr 11

Hi John,

I would advise you to raise your rate by at least US$ 0.005 per source word. This way, a payment for a 4,000-words job will be increased by US$20.00 to compensate for the associated charges. I hope the client values you enough to agree to this type of an increase (don't tell him the true reason, though).


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Lingua 5B  Identity Verified
Bosnia and Herzegovina
Local time: 04:26
English to Croatian
+ ...
Several fees on PayPal. Apr 11

Thayenga wrote:

So they want to charge $ 10 for transferring your money to PayPal? Well, PayPal will also charge you between 4 - 10% of the amount received. This means that you will be paying fees twice while the agency pays exactly $ 0.00 in fees.

As a small business you need to include all of your expenses in your rate, so I hope you charge at least $ 0.14 per source word.


Paypal charges fees for:

- Sending the money (charges the sender)
- Receiving the money (charges the recipient)
- Currency conversion (PayPal conversion rate which is very high)
- Money withdrawal

At least in some countries all four fees are present simultaneously.

Do I need to mention I am avoiding PayPal as much as possible?


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jyuan_us  Identity Verified
United States
Local time: 22:26
Member (2005)
English to Chinese
+ ...
Trust me Apr 11

Vladimir Pochinov wrote:

Hi John,

I would advise you to raise your rate by at least US$ 0.005 per source word. This way, a payment for a 4,000-words job will be increased by US$20.00 to compensate for the associated charges. I hope the client values you enough to agree to this type of an increase (don't tell him the true reason, though).


This kind of clients would never agree to your raising your rate. If they would, they should have never imposed such a charge when making a payment in the first place.


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Marissa Aguayo Gavilano  Identity Verified
United Kingdom
Member (2016)
English to Spanish
+ ...
What about transferwise? Apr 11

Hi John,

Do you know if they would agree to make ACH payments to a US account? You can register with Transferwise and get a USD account with a US bank so that you can get direct payments from the US. That's what I do for US based clients. I'm also in the UK. You can then exchange the money into GBP and transfer it to your UK account at a better rate than your bank would give you for a wire transfer.

Marissa


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Chris S  Identity Verified
United Kingdom
Swedish to English
+ ...
My advice Apr 11

Do not under any circumstances build up a large amount of credit with a company that operates in that way. They are not to be trusted.

I've worked with a few large US agencies over the years and they have not charged anything for payments.

But in the greater scheme of things, $20 is not much if there is enough work.


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Lingua 5B  Identity Verified
Bosnia and Herzegovina
Local time: 04:26
English to Croatian
+ ...
Yes, but... Apr 11

Chris S wrote:

Do not under any circumstances build up a large amount of credit with a company that operates in that way. They are not to be trusted.

I've worked with a few large US agencies over the years and they have not charged anything for payments.

But in the greater scheme of things, $20 is not much if there is enough work.


If his invoice total is $20 then I guess it is much.


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Michal Fabian  Identity Verified
Canada
Local time: 22:26
Member (2012)
Dutch to Slovak
+ ...
Apr 11



[Edited at 2018-04-11 13:31 GMT]


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Baran Keki  Identity Verified
Turkey
Local time: 05:26
Member
English to Turkish
+ ...
Paypal charges the Sender? Apr 11

Lingua 5B wrote:


Paypal charges fees for:

- Sending the money (charges the sender)
- Receiving the money (charges the recipient)
- Currency conversion (PayPal conversion rate which is very high)
- Money withdrawal

At least in some countries all four fees are present simultaneously.

Do I need to mention I am avoiding PayPal as much as possible?


I thought Paypal was only charging the recipient. I always see the invoiced (sent) amount and the Paypal Service Fee (which always varies arbitrarily) on slips.


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Lingua 5B  Identity Verified
Bosnia and Herzegovina
Local time: 04:26
English to Croatian
+ ...
Depends on country. Apr 11

Baran Keki wrote:

Lingua 5B wrote:


Paypal charges fees for:

- Sending the money (charges the sender)
- Receiving the money (charges the recipient)
- Currency conversion (PayPal conversion rate which is very high)
- Money withdrawal

At least in some countries all four fees are present simultaneously.

Do I need to mention I am avoiding PayPal as much as possible?


I thought Paypal was only charging the recipient. I always see the invoiced (sent) amount and the Paypal Service Fee (which always varies arbitrarily) on slips.


Sometimes they charge both parties.


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Philippe Etienne  Identity Verified
Spain
Local time: 04:26
Member
English to French
Not common practice Apr 11

1) Am I the only one to find this outrageous? Then why not add a charge for invoicing, in the name of "management fees"?

What is more common with large, well-known agencies is that they won't pay their own bank charges, and certainly not your own. What I understand here is that they charge you to cover their own internal overhead for proceeding with a bank transfer, but it doesn't mean they pay their own bank charges. This should be clarified to anticipate the blow.
From experience, even without the "processing fees" you mention, you may end up with US$50+ less on your account for each bank transfer US>EU.

Potential expenses to factor in in your case:
Agency processing fees $20
Issuing bank $20
Intermediary bank if any $20
Your bank $20
And then you have:
a few percent' loss on the exchange rate if you invoice in currencies other than your domestic's
heavy interests for any overdraft if the customer takes their sweet time to pay.

Paypal costs around 4% for payments US>EU (~€40/€1000), or the yearly gross return of your low-risk investment fund if you're lucky.

2) As already mentioned by esteemed colleagues, there may be cheaper alternatives. However, many large agencies are all but accommodating, to say the least, when it comes to means of payment they don't offer themselves, ie anything outside the usual Paypal-cheque-bank transfer tryptic, in a frame made of all-expenses-onto-you.

As a small-scale business, I aim to where my best interest is, and it is an endless quest. Today, with a lowish $ against the €, I know I am not competitive on the NA market when I factor in the expenses for receiving my euromoney from there.
So as an EU resident in a massive EN>FR market, I now only serve a handful of smaller agency clients within the EU, who keep me widely busy. Astonishingly, I receive the exact invoice amounts every month, 30 days from invoice date (I invoice at the end of each month). Why exactly should it ever be otherwise?

Philippe

Edit: Oh, and forget about cheques sent by snail mail: if they don't get lost on the way, it takes about a month to clear and it costs an eye.

[Edited at 2018-04-11 17:09 GMT]


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Jenny Forbes  Identity Verified
Local time: 03:26
Member (2006)
French to English
+ ...
No, not normal Apr 11

No, I don't consider it "normal" for an agency to charge fees for paying its translators.
Over the years I have had many clients in the United States who have paid me by wire transfer to my current account in the UK without deducting any charges. Doubtless my bank here takes its cut on the exchange rate but the sum sent is the sum invoiced.
Whether the OP should accept such charges is, of course, entirely his decision, depending on his personal situation. I'm just answering the original question and saying that in my experience it isn't normal for an agency to make such charges.


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The Misha
Local time: 22:26
Russian to English
+ ...
What do you care what "normal practice" is? Apr 11

What you should ask yourself instead is whether you, personally, in your specific circumstances, could live with it, or how you could compensate for it, or negotiate it away, and if you cannot, whether it's an absolute deal breaker.

There is no such thing as "universally" normal - and that's that.


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