PayPal is what most clients know. Payoneer is what most marketplace freelancers end up using. The fee gap between them comes down almost entirely to one number: what each charges to convert your dollars.
All figures verified 14 October 2026 against Payoneer's pricing page, PayPal's UK and US business fee pages, and Upwork's withdrawal-method help. GBP amounts use the mid-market rate on that date ($1 = £0.7569).
Payoneer vs PayPal: Fee Table
| Fee | Payoneer | PayPal |
|---|---|---|
| Convert currency in your balance | 0.50% | 3% above base rate (UK and US business accounts) |
| Withdraw to a bank in your own country, same currency | $1.50 (UK, US, Canada, Australia, EU and others) | Free (standard transfer, no conversion) |
| Withdraw with conversion in one step | 1.2% – 4% | Conversion fee applies (3%) |
| Instant withdrawal | — | 1.50% (US business, minimum $0.50) |
| Receive from a marketplace (Upwork, Fiverr…) | Set by the marketplace | Set by the marketplace |
| Client pays by card | Up to 3.99% + $0.49 | UK: 2.9% + fixed fee, plus 1.29% (EEA payer) or 1.99% (elsewhere) for international payments |
| Client pays from the same platform | Free (Payoneer to Payoneer) | Commercial rates above apply |
| Annual account fee | $29.95 only if you receive under $6,000 in 12 months | None |
| Debit card | $29.95/year; up to 3.5% on foreign-currency spend | No annual fee |
Real Cost: $1,000 From Upwork Into a UK Bank
| Route | Cost (excluding Upwork's own transfer fee) | You receive |
|---|---|---|
| Upwork → Payoneer → convert in Payoneer (0.50%) → GBP to UK bank ($1.50) | $6.50 | ~£752.00 |
| Upwork → Direct to US Bank (your Wise USD details, $2.99 fee) → convert in Wise (0.33% + $0.58) | $6.86 (includes Upwork's $2.99) | ~£751.72 |
| Upwork → Payoneer → withdraw USD straight to a GBP bank (1.2% – 4%) | $12 – $40 | ~£727 – £748 |
| Upwork → PayPal → convert in PayPal (3%) → withdraw GBP (free) | $30 | ~£734.21 |
Upwork charges its own small fee for each withdrawal to Payoneer or PayPal. The amount is shown in your Upwork payment settings rather than on a public page, so it isn't included above. Since 1 September 2026, Upwork's Direct to U.S. Bank method costs $2.99 per withdrawal for freelancers whose tax address is outside the US.
The cheapest Payoneer route is to convert inside Payoneer first, then withdraw in your local currency. Older advice — including earlier versions of this page — said to send USD from Payoneer to a Wise USD account and convert there. Under Payoneer's current pricing, sending USD from a UK account to a US bank account counts as a cross-border withdrawal at 1.2% – 4%, which wipes out Wise's lower conversion fee.
Get your free Payoneer account →Annual Cost on $2,000 a Month
Converting $2,000 of Upwork income to GBP every month, withdrawing once a month:
| Route | Yearly fees |
|---|---|
| Payoneer (convert in Payoneer, $1.50 withdrawal) | ~$138 + Upwork's Payoneer transfer fees |
| Upwork Direct to US Bank → Wise | ~$122 |
| PayPal (3% conversion) | ~$720 + Upwork's PayPal transfer fees |
Moving from PayPal to Payoneer saves roughly $580 a year at this income.
Where PayPal Hides Its Cost: the Exchange Rate
PayPal's withdrawal is free, so the fee feels like zero. It isn't. When PayPal converts your USD balance, it applies its own exchange rate 3% above its base rate on a business account. On $1,000 that is $30 you never see as a line item — it is simply built into the rate.
There is no cheap way around it on a UK account: withdrawing USD to a US bank account also costs 3% on PayPal UK. If a client pays you regularly, ask them to pay by bank transfer to your Wise or Payoneer receiving details instead.
Direct Clients: a Different Comparison
For clients you invoice yourself, neither is the cheapest tool:
| Payment type | Best option | Why |
|---|---|---|
| Upwork / Fiverr payout | Payoneer | 0.50% conversion and $1.50 local withdrawal |
| US client paying by bank | Wise | Free to receive USD by ACH into your Wise USD account |
| UK client paying by card | Stripe | 1.5% + 20p on standard UK cards |
| Client already on Payoneer | Payoneer | Free between Payoneer accounts |
| Client insists on PayPal | PayPal | Convenience — budget for the 3% conversion |
When PayPal Is Still the Right Choice
PayPal wins on familiarity. If a non-technical client or a one-off buyer wants to pay with the account they already have, PayPal removes the friction. Accept the payment and budget for the 3% conversion — that is the price of the convenience. If a client pays you every month, it is worth asking them to switch to a bank transfer.
Which to Choose
| Your situation | Best choice |
|---|---|
| Upwork or Fiverr income in USD | Payoneer — convert inside Payoneer, withdraw locally |
| Low volume (under $6,000 a year) | Check Payoneer's $29.95 annual fee before signing up |
| Clients insist on PayPal | PayPal for those clients, and move regular clients to bank transfer |
| Direct client invoicing | Wise (bank transfer) or Stripe (cards) |
| Maximising take-home pay | Payoneer for marketplaces + Wise for direct clients |
Common Mistakes
Withdrawing USD from Payoneer to a bank abroad. For non-US accounts this is priced at 1.2% – 4%. Convert to your local currency inside Payoneer (0.50%) and withdraw locally for $1.50.
Keeping regular clients on PayPal. PayPal's 3% spread applies whenever it converts for you, including when you withdraw USD to a GBP bank — and a UK account pays 3% to withdraw USD to a US bank too.
Ignoring the low-volume fee. If you receive less than $6,000 in 12 months, Payoneer charges $29.95 a year.
See also: Payoneer fees explained · How to stop losing money to PayPal fees · Best Fiverr withdrawal methods UK
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