Understanding Contractor Payment Fees and Currency Conversion

Managing a global workforce involves navigating complex financial landscapes, particularly regarding international transfers. At RemoFirst, we strive for transparency in how these payments are processed to ensure both clients and contractors have clear expectations.

The Payment Provider Fee

Clients are often surprised by transfer fees that appear during the billing cycle. To cover these essential costs, RemoFirst applies a Payment Provider Fee, which is a 2% charge based on the total invoice amount. This fee is comprehensive and covers:

• Payout Costs: General transaction fees associated with sending funds globally.
• FX Conversion Costs: A percentage-based fee applied whenever a foreign exchange conversion is required from your funding currency to the contractor's destination currency.

How Cross-Border Payments Work

RemoFirst handles the complexity of cross-border processing so your contractors receive their full agreed-upon amount in their local currency. For example, employees in Mexico must be paid in Mexican Pesos (MXN). In this scenario, you fund the payroll via ACH in USD, and RemoFirst manages the conversion to MXN, including all required local tax withholdings and filings.

Currency Fluctuations and Invoicing

Because contractor salaries are often set in their local currency while clients fund the account in USD, your invoice total may fluctuate slightly each billing cycle. These variations are a direct result of market exchange rate changes between the time of invoicing and the final local disbursement. This model ensures that the contractor-facing amount remains stable and compliant with local labor laws.