The freelance economy is witnessing rapid growth worldwide during the current pandemic, and it is not expected to slow down but to increase dramatically across global markets, as companies reduce on-site staff and more people sell their skills on the open market.
In just two major economies, the US has 57 million freelancers, who contribute an estimated $1 trillion to the US economy, and Europe has millions more making up 20-30% of the European job market.
However, as more freelancers expand their offerings to cross-border clients, their needs grow for efficient, effective and economical cross-border payment solutions.
Those clients who choose to embrace change and innovation to enter new markets, drum up investment and entice the strongest, international talent, find that cross-border payment restrictions are holding them back.
Freelancers want to be paid swiftly for their work, in their own local currencies and without exorbitant service fees on payments — such as credit card transactions, which can incur a 10% surcharge.
Currency fluctuations, excessive transfer costs (sometimes as high as 20% of their original invoice) and complicated paperwork mean that freelancers and their clients become reluctant to expand outside their own territories.
Being fully conversant with the digital economy, freelancers expect their user experience with financial transactions to be the same if not better than social networks or other apps they use daily.
However, this is not the norm. Most companies lack the expertise to manage cross-border payments and dealings with traditional banks and money transfer operators (MTOs) are characterised by a lack of transparency, long settlement periods, high transaction costs, and limited accessibility.
Delayed payments compound these issues and 29% of all freelancers’ invoices are paid late or not at all. This is financially devastating to freelancers during the ongoing health crisis, even as the pandemic is expected to boost gig economy participation. At the same time, clients want to know that the work has been completed to the required standard before making payment.
As freelancers are coming to occupy a crucial role in the global economy, Velvet Platform, wishes to ensure that those freelancers can receive their payments — as well as make their payments — quickly, seamlessly and in their desired currencies. It is also of the utmost importance for the clients that rely on their services that a climate of mutual trust be created.
Velvet Platform allows freelancers and their clients to focus on growing their business, instead of dealing with administrative issues associated with international payments.
By collaborating with payment platform technology specialists, we have built a global transaction-based application programing interface (API) platform, specifically for freelancers and project managers, removing the complexity that limits them from receiving or making international payments.
We have considered time and costs that could be saved by streamlining business procedures, and encourage you to work with a payments platform that prioritizes onboarding and AML processes, arranges incremental payments between freelancers and their clients in the currency that suits both parties and assures payments through a reliable escrow system.