Using PayPal to for inbound invoice payments

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Forums › Finance and wealth management › Using PayPal to for inbound invoice payments

dclegg

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#77784 22-Feb-2011 11:21

I've recently started some independent contracting work for a US based company. While we had initially agreed that I would be paid directly into my New Zealand bank account, they are now wanting to pay my invoices via PayPal instead, citing the high fees involved in wire transfers.

I'm about to go investigate into this now via PayPal's website, but wanted to know if anyone here has had any experience with doing this. In particular any gotchas that may not be mentioned on their website would be greatly appreciated.

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BDFL - Memuneh
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#442307 22-Feb-2011 11:33

No gotchas. If you have a good standing PayPal account you should be ok.

You can invoice from there as well.

You need to register your New Zealand bank account with them. Withdrawals take about two or three days (for me) and cost $1 under NZ$150, free over it.

Bank accounts use our standard numbers, not SWIFT coding.

jbard

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#442308 22-Feb-2011 11:33

The big gotcha is getting the money out of paypal and into your NZ bank account, although the fees are not to high, it usually takes me 2-3 months after the money leaves the paypal account before showing in my NZ account.

Of course if your just spending it right out of the paypal account then this isn't a problem.

jbard

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#442310 22-Feb-2011 11:34

freitasm: No gotchas. If you have a good standing PayPal account you should be ok.

You can invoice from there as well.

You need to register your New Zealand bank account with them. Withdrawals take about two or three days (for me) and cost $1 under NZ$150, free over it.

Bank accounts use our standard numbers, not SWIFT coding.

Really 2-3 days?

I must be doing something wrong then, possibly because i am not verified?

freitasm

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#442312 22-Feb-2011 11:35

jbard: The big gotcha is getting the money out of paypal and into your NZ bank account, although the fees are not to high, it usually takes me 2-3 months after the money leaves the paypal account before showing in my NZ account.

It must be your bank... I use BNZ and get the money in 2 - 3 days.

jbard

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#442313 22-Feb-2011 11:36

freitasm:
jbard: The big gotcha is getting the money out of paypal and into your NZ bank account, although the fees are not to high, it usually takes me 2-3 months after the money leaves the paypal account before showing in my NZ account.

It must be your bank... I use BNZ and get the money in 2 - 3 days.

Hmm i use weatpac, i will have to look into this later.

Kyanar

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#442319 22-Feb-2011 11:43

I use Westpac also. 2-3 days is the norm.

jbard

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#442321 22-Feb-2011 11:45

I always did think i was waiting far to long, i must have some setting wrong or something - will check it out at lunch time :)

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dclegg

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#442323 22-Feb-2011 11:45

jbard: The big gotcha is getting the money out of paypal and into your NZ bank account, although the fees are not to high, it usually takes me 2-3 months after the money leaves the paypal account before showing in my NZ account.

Of course if your just spending it right out of the paypal account then this isn't a problem.

Crikey! I'm with BNZ, so I hope I'll see times more like Mauricio's than yours. Waiting 2-3 months would be a show-stopper, and I'd be better off getting them to send me USD cheques. IME, my bank is pretty good with clearing them provided you have a good working relationship with them.

I currently only have a Personal PayPal account (seldom used), and am investigating whether it should be upgraded to a business one (or have a business one associated with it). Having a hard time pinning down the fees on that one so far. The personal account was going to ping me 3.4% + NZD 0.45c for my monthly invoices (plus whatever the transfer fee to my BNZ account is).

nate

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#442342 22-Feb-2011 12:11

Regardless of how you do it (Paypal, wire transfer etc), you'll lose on fees (just a heads up).

dclegg

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#442345 22-Feb-2011 12:15

nate: Regardless of how you do it (Paypal, wire transfer etc), you'll lose on fees (just a heads up).

Oh, I know that. I've been contracting to another US company full-time for a few years now. They pay directly into my bank account and I get pinged $15 at each end (in our respective currencies). From what I can see, PayPal will ping me even more, but my new client is reluctant to use wire transfer, due to fees at their end.

bazzer

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#442351 22-Feb-2011 12:32

dclegg:
jbard: The big gotcha is getting the money out of paypal and into your NZ bank account, although the fees are not to high, it usually takes me 2-3 months after the money leaves the paypal account before showing in my NZ account.

Of course if your just spending it right out of the paypal account then this isn't a problem.

Crikey! I'm with BNZ, so I hope I'll see times more like Mauricio's than yours. Waiting 2-3 months would be a show-stopper, and I'd be better off getting them to send me USD cheques. IME, my bank is pretty good with clearing them provided you have a good working relationship with them.

I currently only have a Personal PayPal account (seldom used), and am investigating whether it should be upgraded to a business one (or have a business one associated with it). Having a hard time pinning down the fees on that one so far. The personal account was going to ping me 3.4% + NZD 0.45c for my monthly invoices (plus whatever the transfer fee to my BNZ account is).

You can have both a Business/Premium and a Personal paypal account, by the way.

b0untypure1

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#442506 22-Feb-2011 19:20

paypal is great, however i had some trouble when paypal put the payment on hold and it never showed up the next day

graemeh

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#442742 23-Feb-2011 13:30

Don't forget to tell your customer you are going to have to charge them 3.4% more to cover the pay pal fees!

dclegg

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#442745 23-Feb-2011 13:42

graemeh: Don't forget to tell your customer you are going to have to charge them 3.4% more to cover the pay pal fees!

It may not be as simple as that, and I may have to write this off as a cost of doing business with them. I've also not charged previous clients for fees incurred for having invoice payments transferred to me.

freitasm

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#442746 23-Feb-2011 13:44

That wouldn't be different of you paying a credit card transaction fee out of your revenue, like other business do...

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