How to Pay Contractors in Russia
June 9, 2021
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While modern technology has given North American business owners the exciting prospect of hiring independent contractors in Russia and other developing countries, not everyone is taking advantage of the opportunity. It often comes down to complications with payment. International independent contractors can be a great asset for your business but getting them their hard-earned money can be a big challenge.
Traditional methods of payment, including checks and bank transfers, are increasingly viewed as inconvenient and outdated. Not only can the fees add up for either the sender or recipient, but these payments require a relationship with a banking institution. You need to make payment easy on yourself and on your workers.
Wondering how to pay contractors in Russia? Take time to research available methods of payment to discover the associated costs and benefits with each. Given the right mode of payment, you’ll be able to focus on growing your business, and your contractors will feel secure and valued.
Why hire contractors in Russia?
North American businessowners see many benefits to hiring contractors in Russia. First and foremost, there’s a diverse talent pool of well-qualified workers in Russia. From web developers to programmers and multimedia experts, there’s no shortage of educated workers who can assist with a variety of tasks. Beyond that, they work for lower rates than their North American counterparts because the cost of living in Russia is about 3.4 times lower than in the U.S.
Many businesses also see an advantage to working with Russian contractors (and overseas contractors in general) because they bring unique experiences and perspectives to the table. Working with people from another cultural and environmental background helps business owners see things in a different light. A fresh perspective might be exactly what your business needs to grow.
Currency and transfer considerations
As businesses decide how to pay independent contractors in Russia, they’ll quickly notice that currency conversion is a cumbersome part of the process. As of May 2021, one United States dollar (USD) is equivalent to just over 74 Russian rubles. There will always be a fee associated with converting currency, and either the sender or recipient will need to cover the cost.
While traditional methods of payment, including bank transfers, have been the standard way to send funds across borders, they require access to traditional banking institutions. In today’s digital world, it’s just not practical to require a contractor to deal with a physical bank to receive the funds they deserve. Moreover, many companies just don’t want to play the guessing game when it comes to paying currency conversion rates.
Ways to pay contractors in Russia
There are several established ways to pay contractors in Russia, but they differ in terms of fees, speed and convenience. Businesses need to take their own needs into account, as well as the needs of their contractors, to settle on a payment solution that works best for both parties.
- Wire transfers. While wire transfers are secure and quick, they’re also prohibitively expensive for businesses sending regular payments to contractors. They’re best for large, one-time transfers, not ongoing payments.
- Check or money order. Paper checks and money orders can be inconvenient for both sender and recipient. Cashing them can be a hassle, and there’s always a chance the check will get lost in the mail—or be turned away for suspected fraud.
- Bank transfer. This relatively affordable method of payment depends entirely on a contractor’s access to a traditional bank. Most financial institutions also charge hefty currency exchange markups, making this option an expensive one.
- Digital payments. The most modern form of payment is also the easiest. Digital payments are convenient for both sender and recipient. Businesses value the low cost and ease associated with this method of payment. Contractors appreciate the transparency and ability to move funds to their desired bank or app with a few clicks.
Paying contractors in Russia doesn’t need to be a difficult task thanks to advances in modern technology. While each of the above options are generally reliable, they’re not always convenient. There’s one method that stands out from the rest and is mutually beneficial for sender and recipient: digital payments.
The best way to pay independent contractors in Russia
Russia is a country in transition, but many citizens don’t have access to traditional banking institutions. The quickest and easiest way to pay independent contractors in Russia is through digital payment systems like Veem. Not only are the fees low for the sender, there’s full transparency for recipients, and they have control over where to transfer their earnings.
Whether you’re hiring a single contractor or an entire team, outsourcing certain tasks for your business can streamline operations and provide opportunities for significant growth. Paying international independent contractors doesn’t have to be a headache if you rely on new technologies for secure transfer of funds. Stay competitive, move your business forward and make contractors happy with fast, efficient and affordable digital payments.