How you choose to receive money from online teaching companies will have a noticeable impact on your paycheck each month. If you have your own private students this is another story.
So, what are the best payment options right now and which ones should you join? Let’s look at seven popular methods now, and discussing the benefits and drawbacks for each payment method.
This post contains affiliate links. For more information, please see my disclaimer.
1. Bank Wiring
If you are living in the US and have a US Bank account, it will be easy to collect money from online teaching companies. Most companies pay in USD and you can accept payments without any bank fees.
If you are not from the US, bank wiring can be an expensive way to receive money from students and companies abroad. It can incur a flat fee and unfavorable exchange rates. You can check the details for sending and receiving money internationally with your current Bank. You may find that using your bank details is a convenient way to accept payments, but you could be losing a lot of money.
If you are Canadian, you may be able to set up a US bank account with certain banks. However you will incur unfavorable exchange fees when you are converting the money to CAD.
Transferwise is my number one recommendation for receiving money for those who don’t have a US bank account. You can open a virtual US bank account no matter what your nationality is and receive money.
You can set up a Transferwise account for free and accept multicurrency. When you sign up, you will be asked to fill in your details. When you do, you can receive your bank details for different currencies. Transferwise uses the mid-market currency exchange so you won’t be affected by poor exchange rates.
When you receive money into your Transferwise account, you can spend it with your Transferwise card, save it or transfer it to your bank account. Transferwise complete fees amount to approximately 0.5% of the transfer’s volume. The website lets you view fluctuating exchange rates and you can sign up for free rate alerts.
Transferwise is highly rated on Trustpilot and it’s a great platform to receive foreign currency from teaching companies. However, Transferwise US borderless accounts are not available to residents in certain countries, so you will have to check if your country is supported.
If you have your own students, you may have to look into other payment options.
Some online teaching companies, such as Palfish, recommend Payoneer to transfer your money. Payoneer maintains an excellent 4.6 star review on Trustpilot and nominated in Forbes top 50 Fintech Companies of 2020.
When you are setting up a Payoneer account, you will have to wait a few days to be approved. Be aware of potential delays when signing up. It also could take a number of weeks to receive your Payoneer MasterCard.
Payoneer allows you to receive and make payments. They charge a 2% currency conversion charge on incoming payments. You can see the exchange rate before you finalize your transfer.
Payoneer integrates well with other platforms, such as Amazon, Airbnb and Upwork. Therefore it is suitable for receiving money as a freelancer or small business. It is available in many countries around the world, making it a good way to accept payment from students.
Paypal is a safe and secure platform to send and receive money. It takes 2-4 days to transfer money to your account. It charges higher fees than the other platforms, and you can set up a multi-currency business account.
Paypal is a good option if you don’t have to exchange currencies. Some online teaching companies, such as Gogokid, allow you to receive money to your Paypal account.
Paypal may not be a wise platform to use to send regular international payments due to the fees. The transfer fees can range from 0.3% to 7.4%, depending on the country. They also charge currency conversion fees and ATM fees.
It may be possible to take payments from Paypal and send it to your Payoneer account for better rates. We cannot guarantee this will work as Paypal doesn’t always accept Payoneer bank details.
People like to use Paypal because of the anonymity when making payments, and not having to enter your credit card details on a strangers’ website.
If you are selling your students’ digital ebooks or courses, you can share your product with Gumroad.
Gumroad has high enough processing fees, at approximately 5% + 0.25c. They take the payment for you, depositing it directly into your bank account.
It is easy to use and you don’t have to worry about self-hosting and let Gumroad do the work. You can accept payments through credit card or Paypal and collect taxes from people living in the EU.
If you want to receive payments directly from your website, you can use a Stripe plugin to accept payments.
This incurs lower fees than Gumroad and Paypal. You will have to go through an application and setup process. Once everything is in working order, you will be ready to receive payments.
Stripe charges 2.9% + $0.30c. SSL certification will be required on your website, so customers can make secure payments on your website
Samcart is a funnel system, similar to Clickfunnels. It can help you promote your lessons and courses but can be a little pricey if you don’t have many students.
If you are selling many things, it can greatly increase the average order value of each customer. Samcart is definitely for the teacher-entrepreneur who wants to create and sell products.
It starts at $99 per month. You can also charge subscriptions to your customers, allow them to sign up for free trials and more.
With each of these companies you can apply and refer your friends to sign up and receive a bonus when you do.
You will see from the options above that we recommend using Transferwise and Payoneer, when possible. Transferwise has some of the lowest fees available and may be the most suitable option for teachers outside the US.
If you are living in the US, you shouldn’t have any problems accepting money via bank transfer or Paypal.
If you are selling courses, you may want to consider Gumroad if you don’t have any hosting. If you have a website and self-hosting, you might want to consider using Stripe to accept payments.
Lastly, if you are accepting many payments, you may want to set up a funnel, such as Samcart. This is suitable for teaching businesses that have many profitable courses.
What payment provider do you use? Let me know what you think in the comments section below.