Which Upwork Wire Transfer method is better? Direct to Local bank VS US dollar Transfer [2017 Update]

The Wire Transfer is one of the most convenient means of withdrawing your Elance earnings to your local bank account. There are other Elance-upwork withdrawal methods which might be more beneficial if you are a US-citizen but for Non-US users,  Payoneer, Wire Transfer and Skrill are the best available  withdrawal methods. If you’re a freelancer there is a chance that Skrill will abruptly change your personal account to a merchant account, after that you’ll be charged extra fees and then Skrill becomes more expensive than other methods .

Payoneer has its advantage in terms of speed of withdrawal and online purchasing but it carries additional fees  for non-US freelancers so it may not be suitable for large withdrawals.  PayPal is great but most non-US countries don’t have full access to this service. Coming back to Wire Transfer, many people are confused about choosing between the two Wire transfer methods- the local fund transfer(LFT) aka local currently transfer vs US dollar transfer. Based on my experience I will clear what these Wire Transfer methods are and whether Local Currency Transfer or US Dollar Transfer is better for you and when to choose one method over another. If you haven’t added your bank account to your Elance-Upwork profile yet, readHow to add your local bank account to Elance-Upwork


Local Currency Transfer or Local Fund Transfer(LFT)

In this wire transfer method, Elance-Upwork will covert the dollars withdrawn from your account to your local currency and then transfer it to your local bank. You can use this method once a month without any charge but for additional transfers you’ll be charged $5 from Elance. In Nepal, local banks will also charge you additional $5 (Rs500) as “processing fee”. So this method seems cheap and convenient right? However, the conversion/exchange rate offered by Elance-Upwork VS Local bank can differ drastically. Below is the result of the test withdrawal I made using the Local Currency Transfer method choosing Nepali Rupee (NPR or Rs).

  • Month: November 2014
  • Amount Withdrawn: $476 USD
  • Exchange rate on Nov 21, 2014: 0.0105 USD/NPR
  • Amount Withdrawn Locally: 45204.18 NPR
    • After $5 (Rs 500) processing fee charged by my bank, the final amount in my account= Rs 44706

Here the Elance-Upwork conversion rate here is 1 USD= (NPR) Rs 95.23. The exchange rate offered by my local bank for that month was 1 USD = Rs 99.  So the bank would’ve give me Rs.47124 had I wired USD instead of local currency. However, if I had chosen USD for that transaction I’d also be charged  $25 processing by Elance and then additional $5 processing fee by the Local Bank. So the final withdrawn amount in USD would then be  $476-$30- $446. The local bank would convert it to ($446 x Rs 99)Rs 44154 -Rs 500(local fee)=Rs 43654. As you can see, for the amount above the local fund transfer method is more beneficial than USD wire transfer.

Suggestion: Use Local fund transfer method for small withdrawals upto $500 because you will incur less fee and despite the low exchange rate the earning will be higher compared to using USD transfer. I have also noticed that the Local Fund Transfer takes longer than USD transfer here in Nepal. For example- while doing USD transfer the money was in my account in two to five days but using local currency it took more than a week. An excellent alternative to LFT is Payoneer, which lets you transfer funds from hundreds of US/EU companies like Elance, Upwork, Amazon, CJ Affiliate etc. to your local bank account. Payoneer’s conversion rates are not the best but better than many other options, and the main advantage of using Payoneer is fast withdrawal and deposit. However, Payoneer’s local bank transfer service is not available in some countries.

[2017 Update on local transfer payment option]: The local fund transfer payment option on Upwork has now been renamed to Direct to Local Bank and now carries a lower fee of $0.99 peer withdrawal. Besides the lower transfer fee, the local currency exchange rate and timing of transfer will basically remain the same.

USD Wire Transfer

This is the common wire transfer option where you transfer the dollar amount from your Elance-Upwork account to your local bank account. After the transfer, the USD is converted by the local bank using its own exchange rate, which in my case I’ve found to be much higher than what Elance ‘s local currency exchange rates. As I have already mentioned above, the local fund transfer is suitable for small withdrawals but for larger transactions $700+ or $1000+ you will save a lot of cash by using the USD Wire Transfer despite the $25 processing fee. Also, USD transfer seems to arrive faster in the local bank compared to local fund transfer. Here is the detail of a recent withdrawal I did using USD Wire Transfer:

  • Amount Withdrawn: $1331.89 USD ($25 already deducted for Elance processing fee)
  • Amount in local Bank in Rs:  Rs 1,30,591
  • After Bank fee total: Rs 1,30,091
  • Exchange rate offered by bank: 1 USD = Rs 97.67

Suggestion: Use USD transfer for large withdrawals.

I hope the above suggestions helped you learn about the local fund transfer and USD wire transfer withdrawal methods on Elance-Upwork. Like I did above, do your own calculations to make sure that the method you have chosen is the best one.

While wire transfer is one the best methods to deposit/transfer large amount of cash into your bank account, if you need your cash fast, you can sign up for Payoneer.  Payoneer MasterCard can be quickly loaded with earnings from Elance-Upwork, and then your cash earning can be withdrawn from your local ATM. You can even get the earnings in your MasterCard on the same day by using the immediate load feature. So, I suggest that you sign up for Payoneer if you want a financial account for online transactions and for quick cash withdrawal. Payoneer has expanded its withdraw to your bank account service to more countries- so if your country is supported, you can also use Payoneer as an alternative to Local Wire Transfer. Payoneer transfers happen within 24 hours and they give much better conversion rates than LFT and PayPal.  Read: How to sign up for Payoneer


Facebooktwittergoogle_plusredditpinterestlinkedinmailby feather