Short answer: the amount you invoice and the amount that reaches your bank account differ because of up to three costs: the platform's fee, the currency conversion (the gap between the rate you are given and the real exchange rate), and any receiving or withdrawal fee on the bank side. The advertised fee is only one of them, so compare options by the final amount in your account.
What it looked like for me
In November 2023 an overseas client paid me $1,000 through PayPal. At the time I hadn't compared transfer services; I went with whatever was easiest for the client. By my estimate, about $40 went to fees and about $30 was lost to the exchange rate, roughly $70 in total, or around ¥10,500 at ¥150 to the dollar. When I checked what actually arrived, I understood that the amount invoiced and the amount left in my account are not the same thing.
The money showed up quickly, but moving it to my bank account and checking the converted amount took extra effort. After that I started using Wise as well, and I now check the transfer fee and the exchange rate separately, deciding by the amount that reaches my bank account instead of the headline fee. In my experience Wise made the fee and the converted amount easier to see, while PayPal was convenient when the client was already used to it. Neither is always cheaper: the result depends on the sending country, the currency, and how the money is sent and received, so I confirm what I will actually receive before I invoice.
The four checks I run before invoicing
- Currency. Which currency will the client pay in, and will it be converted before it reaches me? Each conversion is a place for a margin to hide.
- Who pays the fee. Agree whether the client or I cover the transfer fee before the invoice goes out.
- Final amount. Compare services by what lands in the bank, not by the fee shown on screen.
- Due date. Settlement can take anywhere from the same day to several business days depending on the route, so build that into the due date.
Where to go next
Fees and conversion margins change over time, so use our fee comparison for international payments for current ranges, and Wise vs PayPal for a head-to-head.
The amounts above are my estimate from one payment. Real fees and rates depend on the route, the day, and the provider.
Frequently asked questions
Is the PayPal fee the only cost on an overseas payment?
No. The currency conversion can cost as much as the visible fee, and the bank side may add its own charge. That is why the useful comparison is the amount that reaches your account, not the fee shown on screen.
Who should pay the transfer fee on an international invoice?
There is no single rule. Some freelancers add the expected fee to the invoice and others absorb it. What matters is that it is agreed before the invoice goes out.
Which service is cheapest for overseas payments?
It depends on the route, the currencies and the amount, and fees change over time. Use a current comparison and check the final amount for your own route.