Quick question for Freelancer.com users…

26 05 2010

Just a quick blog post to ask a quick question to Freelancer users…

When I transfer money from my Freelancer.com account to my PayPal account, sometimes I am charged $1 USD, sometimes I’m not charged anything. Why is this? I asked Freelancer.com what this fee is for and to explain why it is not taken every time I make a withdrawal from my account. Freelancer.com replied by saying, and I quote, “Freelancer.com is not charging any withdrawal fee. PayPal is charging $1.00 withdrawal fee…For more clarification regarding this matter, we suggest to contact PayPal.”

So, contact PayPal I did. This was their reply: “We do not have records of the $1.00 USD charges on your account since PayPal is not the one who charged you for the said amount.”

This leaves me very confused! Who is taking a $1 fee from my hard-earned cash, what is it for, and why is it not consistent? As a full time self-employed freelancer it’s very important that I submit accurate records to the tax office and I don’t know what to make of this. Do any Freelancer users out there have any answers?

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23 responses

27 05 2010
lisaamartin

The plot thickens. I emailed Freelancer with the information I received from PayPal and they have now asked me to forward on the PayPal emails I received. Freelancer said, “As far as we know, we do not charge any transaction fees for withdrawals and deposits. It is the gateway method that you are using who charges you with the transaction fees.”

Gateway method – eh? I’m confused! All I’m doing is requesting to move money from one place to another, via the Freelancer website, yet now there is the suggestion that a mysterious third party, which neither I, nor Freelancer, nor PayPal know about, is the $1 thief!

I’ve done as Freelancer asked and forwarded the PayPal emails, let’s wait and see what happens next…

27 05 2010
lisaamartin

Argh! Freelancer are still insisting that the $1 fee is taken by PayPal and that it is a fee for transactions made outside the US. This still doesn’t answer why the fee isn’t taken every time (since I am always outside the US!), and I find that strange because the $1 fee is taken before the money even gets into my PayPal account.

Back to PayPal to see what they say…

27 05 2010
lisaamartin

PayPal can’t open email attachments for security reasons and so have advised that I phone to speak to one of their customer service agents – at the cost of 10p per minute! Screw that! I’ve pasted the emails I originally attached into yet another email! Back to PayPal!

27 05 2010
lisaamartin

PayPal now say it may be a card issuer fee. There is no card involved in a Freelancer-to-PayPal transaction! Another email to PayPal, clear and to the point, is on its way!

28 05 2010
lisaamartin

Crikey, it’s taken me 5 emails to PayPal and a complaint via a customer satisfaction survey to finally get the answer I was looking for!

“Dear Lisa Martin,

Thank you for contacting PayPal regarding recent email received.

I have reviewed your account Ms. Martin, and please let me start by apologising for any email you have received from PayPal to date which has not answered you issue in hand.

I can confirm for you Ms. Martin, There is no $1.00 USD fee from PayPal for transferring USD funds into a PayPal account. For instant I’ll use the example quoted in the email. You transferred $123.00 USD to your PayPal account from Freelancer, $123.00 USD is all PayPal received there is no fee for transferring this funds into your PayPal account.

PayPal do not charge fees for transferring personal payments into your PayPal account. Any fee that has been taking from your Freelancer account is entirely down to Freelancer, PayPal only accept what we see and in this case it was $123.00 USD is what PayPal received.

I hope this clears up any confusion you may have.

Thank you for your time.

Yours sincerely,
Michael
PayPal

Thank you Michael, clearly the most intelligent person working for PayPal!

In the meantime, I’ve had another email from Freelancer which is most confusing! First they said that the $1 fee was down to PayPal, now they bizarrely deny the existence of any fee at all! I’ve sent them a screen shot of the Freelancer withdrawal request screen to prove that there is! Backatcha, Freelancer!

1 06 2010
lisaamartin

FINALLY! I resorted to emailing Alaister from Freelancer, one of the guys who has commented on other posts on this blog and who hired me to write the Wikipedia page. It was probably a bit naughty to use my internal contact in this way, but I was getting nowhere with Freelancer customer support! Anyway, he kindly passed my email on to James, customer services manager at Freelancer, who has finally admitted that Freelancer DOES charge a $1 processing fee when using PayPal.

“I would like to inform you that whenever you use PayPal as a method of withdrawal, Freelancer.com charges a $1 processing fee. This is the case for every PayPal withdrawal. We do not charge the same fees for other withdrawal gateways such as Moneybookers.

I apologise for the mixed responses you received from the support department. I have made a note of it and they will be informed.”

2 06 2010
lisaamartin

I thanked James, customer service manager, for his response and let him know that I think this $1 fee is unfair. Plus, apart from the actual PayPal withdrawal page on Freelancer.com, which simply says that a fee is taken and doesn’t explain what it is for, there is no other mention of this $1 fee anywhere else on the site, even in the “Fees and Charges” section, or under “Miscellaneous Fees”. As a thank you for bringing the matter to their attention, Freelancer have credited my account with $5 – nice! 🙂

14 06 2010
Need to understand why.

I am new to freelancing, have had a little success, still trying to figure it all out. A whole new world out there. I started with freelancer, but soon realized that they are a big trap, and have since moved on.
Working for slave wages is not what I am looking for. Several other sites are available, a lot more legitimate, and are not trying to scam you. Personally I think something is wrong with that site.
Know it really isn’t on your topic, just felt the need to add my thoughts.

14 06 2010
lisaamartin

Hi there, thanks for stopping by my blog! I completely understand your frustration with Freelancer.com. I disagree that the site itself is a trap, although there are several things that need to be improved – one being scrapping the dollar fee mentioned above and the other being a means to permanently block the scammers. I don’t think there’s much you can do to stop people asking ridiculously low wages because the sad fact is, many people are prepared to work for such low fees.

But yes, you’re right, there are lots of other good sites out there – People Per Hour is a good one, as is eLance. I’m not yet convinced by oDesk as they have some weird screen capture system where the buyer can spy on you working but perhaps that’s a just a matter of personal preference.

Good luck with freelancing – it takes a little while to get established, but I now have several clients who come back to me again and again, and I wouldn’t have connected with these people if it wasn’t for freelance bidding sites.

20 08 2010
KC

I also use Freelancer.com and from the beginning I really don’t think it’s Paypal who takes that $1 withdrawal fee. I love that website though, but they charge so many fees.

15 10 2010
Char

I Have signed up for freelancer.com, i really don’t get the bidding, like the freelancer % what is that, and they already have a price set on pay why do we have to bid? and what about days of completion, like for job’s on ebay i don’t know how long it will take for their item to sell.
so could you exlplain it to me. I am sorry to change subject. I just need answer’s from someone who know’s.
thank you for your time
char

15 10 2010
lisaamartin

Hi Char, no problem, I’m always happy to help!
I assume that the “freelancer %” you’re talking about is the fee that it is taken from freelancers when they win a project, or that which is taken from buyers when they award a project. It’s important to remember that Freelancer.com is a business in itself, and they’ve got to make money somehow. So, the way that they do this is to take a small commission from each project that is awarded. For those with a standard Freelancer account, the commission fee is $5, or 10% of the winning bid, whichever is greater. So, if you win a project worth $50, a $10 fee will be taken from your Freelancer account and your net earnings will be $40. If you win a lot of projects, you *might* want to consider upgrading to a Gold account. This costs $24.95 a month and in return, Freelancer will only take a 3% commission. However, it’s probably not worth it if you don’t earn that much.

As for bidding, everyone that posts a project is required to set a budget level. I agree that sometimes it seems pointless bidding when someone then specifies in their project description that they will only pay a fixed fee and won’t negotiate on price! However, don’t forget that your bid should include more than the price. When you place a bid, you’re also trying to convince the buyer that you’re the person for the job, so write a persuasive proposal and you’re more likely to succeed. Buyers don’t always pick the cheapest bids! They’ll pick whoever seems the best match for the job in terms of price, skills and experience.

Finally, the turnaround time for project completion that you specify is really up to you. Sometimes the buyer will have a very clear deadline that they would like you to meet, and if so, they’ll say so in their project description. If not, then you need to judge how long you think it would take you to complete the project. If you’re not sure how much work is involved, ask the buyer a question on the public message board before placing a bid.

Hope that helps! I’ll be posting some more blog posts about Freelancer soon, so please come back and see if I can answer any more of your questions!

Lisa

19 10 2010
Olaf

GAF is scam place, run by scammers for scammers. They suspended my account, after opening a ticket for the USD 420.00 they stole from my account. After well over 3 month – it is still open. Customer support? Apart from the name, what they do, has nothing with service to do.

Actually a nice place, to let some of the frust about them out

19 10 2010
lisaamartin

Hi Olaf, do you know why your account was suspended? As I have mentioned in some of my other posts, people often fail to read the terms and conditions when they register an account with Freelancer.com, and in most cases, there has been a breach of these terms. What Freelancer usually do when an account is suspended – if it is for a minor offence rather than a major fraud case – is ask you to verify your identity, and if you are able to do this, your account will be reactivated. It sounds like your original support ticket has got lost in the queue somewhere – with close to 2 million users on Freelancer.com, it happens! My best advice would be to open another support ticket, quoting the ticket number of your original ticket if you still have it, and to ask for clarification of the situation. I’m sure you can resolve the case amicably.

I disagree that Freelancer is run by scammers (although it is *used* heavily by scammers) and I doubt that your money was stolen by Freelancer staff. Because your account was suspended, the money is probably being withheld until the problem is resolved. If you can give me some more details of the problem I’ll see what I can find out for you. My email address is on the Contact page.

Thanks for your comment and for stopping by my blog!

5 11 2010
Olaf

“I disagree that Freelancer is run by scammers (although it is *used* heavily by scammers) and I doubt that your money was stolen by Freelancer staff. Because your account was suspended, ”

Sounds to be good to be true. The tickets are closed, without any updates, already since month.
After opening follow up tickets, the account has been suspended.
There are still about 200 tickets with follow up requests.. and you guess it right – they are closed. Not a single line of updates.

20 10 2010
Olaf

I confirm again – it was stolen.
The story in short.
Someone was looking for a German translation from English, 25000 words, some 36 hours time – a hell of a bunch of work, impossible- I still made with the “service buyer” an agreement in German, which excluded any proof reading and formatting/ All conversion to it, all in German.
Job done, delivered just 20 minutes before deadline, after being working with a couple of co workers for 36 hours.
On delivery again a request, to excuse some minor mistakes which where likely in and a request, if for some reason not satisfied – return for correction, if the dead line is to stretch out – all again in German.
A deposit of 100% was initially made by the buyer.

After well 10 minutes, a “dispute was files” of 100% due exactly 11 spell mistakes.
GAF kindly gave the scammer 100% re-tour.
The same person, who I did work for, had posted and given away 12 jobs, all 12 jobs closed and awarded and received: 1 !!!!!!!!!! ONE !!!!!!!! feedback.
I had to pay my co workers is well, as well as the loss and the fee, GAF is taking for each project.

After complaining, my account got suspended and since then, October 7th, 2010, my account is suspending and the ticket to the case is untouched by a level 2 since then.

A few rude answers I did receive of “the helpdesk”, but nothing from legal or communication. That is the way, they “work”

A similar thing already happened last year ago, where they attempted to … but that’s another storey.

Olaf

21 10 2010
Ariel

Interesting blog and nice follow up on your communication with both freelancer I paypal. I kind of knew that it was freelancer indeed who charge for that fee. Now, I also noticed that sometimes they didn’t charge that fee, did you get an explanation on that? Or, could you figure out when is it that’s not charged?

21 10 2010
lisaamartin

Hi Ariel. Actually, no, I never did a straight answer as to why the $1 fee is charged and sometimes not. I never really got a straight answer as to why it is charged at all! Even the customer services manager wasn’t sure. I’m in contact with a few of the guys at Freelancer now so I may well follow this up again for another blog post.

29 10 2010
FAQ: What fees do Freelancer.com charge? « Lisa A. Martin

[…] I have been unable to ascertain why Freelancer charges this fee or what it is for! (See my blog post on this! Helpful Sheila at her best […]

27 11 2010
M Zargham

really a good blog. i m just started lets c what happens with the time. bit i also think that 10% fee is very high, what u say. and yes about bidding low. this is all about currency rates in diff counteries and inflation rate. any advice for me how to win more bids and can we contact buyer out of site after complition of first project

28 11 2010
lisaamartin

The 10% fee is pretty high. but don’t forget you can always factor this into your bid. As I am a self-employed UK based freelancer, any Freelancer or PayPal fees I have to pay are also tax deductible, soI can claim for these on my tax return. I’m not familiar with the tax system in any other countries, but you might be able to do something similar.
And yes, of course, once you have been awarded and accepted a project via Freelancer, there is no reason why you cannot then continue to work for that person outside of Freelancer. I do this all the time, and in fact the majority of my work comes from repeat business from people I first met through Freelancer.com. 🙂

1 01 2012
Jody Noel (@Jody_Noel)

Thank you so much for posting all this detailed info. I’m a freelancer there as well and currently printing out financial records for taxes being that it’s Jan 1 (Happy new year!) I’m trying to figure out where the $1.00 fee is recorded so that I can deduct it for taxes… and as far as I can see it’s no where! This is the shadiest part of the deal to me. I’m okay with the charge….but it must be recorded somewhere! Otherwise it’s WAY shady.

The only way you can prove it’s taken at all is by comparing your paypal deposit amount to the freelancer ‘payments’ deposit amount for each. The $1 discrepancy appears to be the only proof.

BTW. About a month ago I messaged support about this as well…..and they told me the exact same thing verbatim…

“Freelancer.com is not charging any withdrawal fee. PayPal is charging $1.00 withdrawal fee…For more clarification regarding this matter, we suggest to contact PayPal.”

Thanks for sharing your effort,
@Jody_Noel

6 10 2012
Fake

Lisa, this is truly a nice place to know about that freelancer.com is a Huge extra commission charger. I always prefer oDesk and sticking with it since 2009, their customer support is great and their payment methods are awesome. I prefer to switch to oDesk.com since there are no fees no memberships no stupid jokes like Memberships and Upgrade plans. Just simple oDesk.com and 10% on each hourly rate you propose or 10% on each fix price but since they do not offer guarantee on fix price projects. Neither to Contractor nor Client. But their hourly charging method is OK and withdrawals are also fine.

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