Best Ways to Make Payments to Foreign Contractors

As a business owner you can hire contractors and freelancers from all over the world, to help manage projects and build your company. Using international contractors can bring great benefits in terms of skill, experience and cost. However, you’ll need to figure out how to pay your international team members so they can get their money conveniently and without excessive fees.

This guide to paying international contractors is the place to start, with 4 of the best ways to make payments to contractors outside of the US:

  1. International wire transfer with your bank
  2. Specialist international money transfer company
    1. Wise
    2. WorldRemit
    3. Revolut
    4. PayPal
    5. Payoneer
  3. A multi-currency account
  4. Checks and money orders

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Key points

Different ways of paying international contractors from the US have their own advantages and disadvantages:

  • International wire transfers – a well-known and accessible method for paying international contractors, but they are complex and sometimes costly. More on that later
  • Online payments solutions – lots of choice here, depending on where you’re sending money to, and how fast you need it to arrive
  • Multi-currency accounts – a good option if you pay freelancers in various currencies or have a global business
  • Checks and money orders – slightly outdated, but some still prefer them because of the flexibility of where the money can be collected from

International Wire Transfers with Your Bank

You’ll usually be able to send a wire transfer to your international contractor from your regular bank. The process for this will vary depending on who you bank with, but in many cases you’ll be able to arrange your payment by logging into your online banking service.

Before you get started, be sure to check out the costs of an international wire, which can include an admin fee, cable charges, SWIFT/BIC fees and a markup on the exchange rate.

Pros and cons of using a bank transfer for international payments


  • Sending a wire is familiar and often easy to do through online banking
  • Secure service provided by all major banks


  • Bank wires can be extremely costly compared to alternative providers
  • Depending on where you’re sending to, a wire may not be the fastest method

Online payments solutions

Online payments solutions cover many different providers, from companies which are set up to help customers deposit funds in bank accounts all over the world, to providers which offer varied payout options like cash pick up, and services like PayPal which require the recipient to have their own account with the provider too.

Different online payment services have their own features and fees, so you’ll want to compare a few before you choose the right one for you. Check out the transfer fee, as well as the exchange rate applied when you’re sending to an international contractor – both make a big difference to the overall price.

You’ll also have to look at the delivery times to make sure your money arrives when you want it to. However, the good news is that plenty of these online payment services offer transfers which can be faster and cheaper than using an international bank wire.


Wise offers international transfers which arrive directly in your recipient’s bank account in 80+ countries around the world. You’ll get the real mid-market exchange rate with no markups added, and pay a low, transparent fee. Fund your payment with a bank transfer/ACH for the lowest costs.

Wise international payments – pros and cons


  • Low, transparent fees with no markup on the exchange rate
  • Payments are often received very quickly – depending on the destination country, your money can arrive in hours


  • You’ll need to set up an account online to make a payment
  • Fees vary based on the service you select – funding your payment with a card may cost more than using a bank transfer

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With WorldRemit you can send payments to your contractors all over the world. 130 countries are covered, with services including bank transfers, cash collection, mobile money payments and even airtime top-up. Fees vary, and there may be a markup added to the exchange rate used. Many payments are available within minutes, although bank transfers can take a little longer depending on the specific bank’s own processes, the time of the transaction and the day of the week.

WorldRemit international payment – pros and cons


  • Payments can be made to bank accounts, for cash pick up or even to mobile money accounts
  • Broad range of countries and currencies covered


  • You’ll pay a transfer fee, and there may also be fees added to the exchange rate used
  • Not all services are available in all destination countries

Read WorldRemit ReviewGo to WorldRemit


Revolut has both personal and business account options. For business customers, there are a couple of different ways you can use Revolut. Sign up for a free account and pay a fee every time you make an international transfer – or choose to open a paid account plan, and get some free international transfers and a range of other useful perks and tools. Monthly fees for the most popular plan are 39.99 USD.

Revolut international transfers made within your account limits use the mid-market exchange rate with no markup. If you have a free plan, or exceed the limits on your account type, you’ll pay a markup of 0.4%, plus a 3 USD fee for every transaction.

Revolut international payments for business – pros and cons


  • Choose either a free basic account to pay 3 USD + 0.4% per international transfer, or upgrade to a paid account which has free transfer options
  • Paid accounts come with lots of other functions like expense management and bulk payments


  • Free transaction limits vary according to the plan you select – the most popular Grow account has a 39.99 USD/month fee
  • Currency exchange offered on 28 currencies only – check the currencies you need are covered

Read Revolut Review


As a leader in digital payments, PayPal offers solutions to business owners looking to send and receive money online. With a PayPal business account you can send money to contractors – as well as receiving payments from customers through invoices, in person or online. PayPal international Payouts can be made to multiple contractors at once, and have a 2% fee. You’ll also pay a currency conversion charge when you need to switch between currencies, which will be 3% or 4% depending on the situation.

PayPal pros and cons


  • Familiar brand with good security in place
  • Many people will already have a PayPal account, making this a convenient option


  • 2% fee to send a PayPal Payout, plus currency conversion fees of 3% – 4%
  • Recipient will need to have or open a PayPal account to access their money

PayPal ReviewAlternatives to PayPal


Payoneer offers accounts for small businesses, freelancers, ecommerce sellers and entrepreneurs. You’ll be able to use your account to make and receive payments, with pay per use fees. Sending an international payment has a 3% fee if you fund it using a credit card.

Using a bank transfer to pay will come with a lower fee of up to 1%. There may also be markups added to the exchange rates used, so you’ll want to check the details for the specific payment you need to make before you confirm it.

Payoneer pros and cons


  • Payoneer is a specialist in account solutions for entrepreneurs and SME owners
  • Pay per use fee structure so you don’t pay for any services you don’t need


  • International payment fees are higher for credit card users – 3% plus any markup added to the exchange rate
  • You’ll need to set up and verify your account to get started

Use a Multi-currency account

As soon as you start bringing in foreign contractors, using overseas suppliers, or selling to international customers, you should consider getting a low cost online multi-currency account from a provider like Wise Business, Revolut Business or OFX for Business.

Some traditional banks also offer multi-currency accounts for business customers, but typically these options are more restricted with high minimum balance amounts, and costly fees.

In general multi-currency accounts let you hold, exchange, send and spend in a broad range of currencies – Wise Account covers over 50, as an example, and comes with a linked Wise debit card for easy spending and withdrawals.

Use your account to pay contractors and suppliers, and get paid by overseas customers in their preferred currency. You can then hold foreign currency balances and use them to pay bills internationally in future, or switch back to pounds when you want to within the account.

Pros and cons of the Wise multi-currency account


  • Hold, exchange, send and spend in a range of currencies
  • Make payments to contractors in 80+ countries with the mid-market exchange rate
  • Get linked debit cards to spend internationally with the real exchange rate


  • No branch network
  • You can’t add funds in cash or cheque

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Checks and money orders

Checks and money orders are somewhat outdated, but still popular payment methods in some countries. That means you may find that international contractors request these as a means of payment. You’ll probably be able to write and mail a check from your regular bank account easily enough – or use a Money Order or Sure Money (DineroSeguro) wire via the US Postal Service.

Checks aren’t widely used in some other countries, so do make sure the recipient can actually cash it. Money Order payments can be made to countries which have agreements in place with the USPS, with fees, limits and specific requirements applying to each destination country and payment method.

Pros and cons of using checks and money orders


  • Pay with cash for a Money Order, and send to recipients who don’t have a bank account
  • Money Orders are popular in some countries, particularly in Latin America
  • Checks are easy to use for the sender


  • Fees are high for Money Orders
  • Your recipient can’t get their money until the check or Money Order has been delivered and cashed
  • Not widely accepted in many countries

How to pay international contractors

Let’s look at the step by step ways to pay international contractors using an international money transfer or a multi-currency account.

How to Pay Overseas Contractors with International Money Transfers

If you’re sending money with your bank you’ll often have the option to set up your payment in a branch, by phone or online. Specialist services tend to work through desktop sites and apps – and you may need to register and verify an account to get started.

Once you have an account registered, here are the basic steps to pay an international contractor:

  1. Log into your bank or specialist provider account online or in their app
  2. Navigate to the payments section and select international payment
  3. Add the amount you want to send in USD or the amount you need the recipient to get in their destination country
  4. Enter the recipient’s full banking details – what’s needed will vary depending on where you’re sending to
  5. Complete the verification steps, confirm and your money will be on its way

How to Pay Overseas Contractors using Multi-currency Accounts

Another great option to pay international contractors is the use an online multi-currency account.

As an example from one of the providers we looked at earlier, here’s how to send money with Wise:

  1. Download the Wise app or head to the Wise website
  2. Create an account by entering your email – alternatively, sign up with your Google or Facebook account
  3. Enter the amount of money you want to send, or the amount you want the recipient to receive
  4. Confirm the transfer type, and enter your personal details using the onscreen prompts
  5. Add the recipient’s bank details or email address
  6. Review and add a message for the recipient
  7. Choose how to pay, and follow the instructions to fund your transfer
  8. Both you and the recipient will be notified once the payment is made

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What to consider before paying independent contractors

Before you start working with international contractors, you’ll want to read up on the implications of growing your team overseas. The exact rules may vary according to your working relationship with the contractor, and where in the world they’re located. Take professional advice if you need it, to make sure you’re fulfilling all your obligations both locally and wherever your contractors are based.

One important step is to have your contractor complete and give you a Form W-8 BEN, which is used to show they’re not US citizens. This IRS form means that you shouldn’t need to withhold tax, allowing your international contractor to manage their own tax affairs locally.

The next consideration is a more practical one – making sure both you and your contractor are very clear on the payment terms and conditions. You should have a written contract in place before work begins, which sets out full payment details, including payment methods, due dates, currencies, and what happens if things don’t work out – if work is late or not to standard, for example.

With your contract in hand, it’s over to you to make sure you’ve planned a payment method which lets you keep up your end of the bargain. You’ll have agreed payment due dates already, so now you need to decide how you’ll process transfers to your foreign contractor in a way that doesn’t cost you too much, and where payments will definitely arrive on time.

If you are a freelancer looking to get paid, this guide may be more helpful: How to get paid as a freelancer

What are the benefits of hiring foreign contractors?

Here are a few reasons why you might want to hire overseas contractors into your business:

  • Using contractors gives flexibility to your business – from long term gigs to one off projects
  • Looking for contractors globally means you have the best possible chance of finding a perfect match
  • International contractors can be a great way to grow your business if you bring in people who are close to customers and suppliers overseas
  • International talent can be a cost effective way of getting skilled people into your business, for the short term or as a more permanent arrangement in future
  • No need to invest in large offices as your team will work remotely, plus cut the costs of benefits as compared to engaging a full time permanent team

Conclusion: what is the best way to pay international contractors?

Foreign contractors can be exactly what your business needs to grow. From bringing in new skills, to the flexibility of hiring people as and when you need them, contractors can make a huge difference to a growing business. And by looking for the best people on a global scale, you can hire individuals who fit your brand, and who are able to help your company grow internationally.

Use this guide as a starting point for some of the things you need to consider when using foreign contractors – including the best ways to pay international contractors from the US. By picking the right payment method up front you’ll cut your costs and can get the very best return for your business.

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FAQs on Paying Foreign Independent Contractors

How do I pay someone from another country?

You may want to pay overseas contractors through international bank transfers, multi-currency accounts and payment gateways like PayPal. Compare a few to see which works best for you.

Can a US company pay a foreign contractor?

Yes. However, you’ll probably want to get professional advice to make sure you’re fulfilling your legal and tax obligations, and following any relevant rules in the contractor’s own home country.

Are overseas contractors tax exempt?

Generally contractors are responsible for most of their own tax matters, but you may still have obligations to report payments or pay some benefits. Get professional advice before you start employing overseas contractors to check how the law applies in your specific situation.

Can you hire someone from another country to work remotely?

Yes. Hiring remote workers overseas can be a really helpful way to add talent to your business and reach international markets.

Ileana Ionescu
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Last updated
December 29th, 2023