Upwork's Unfair Exchange Rates

[eeeb8fb9]

The way Upwork handles exchange rates for non-American freelancers needs to be changed. Currently, Upwork uses a "partner" bank, but this approach is too expensive for most of us. As a Kenyan, for instance, most banks here buy USD at Ksh127 and sell it at approximately Ksh139 (as of today and in the recent past), whereas Upwork's "partner bank" buys USD at Ksh123, significantly lower than all other banks.

I checked Upwork's community section and found that other users have also expressed frustration with the exchange rates. Upwork often responds that "online conversion rates don't account for the markup applied," but in reality, all other banks are providing much better conversion rates than this "partner bank." I don't want to add my frustration as comments to these other threads because I beleive that this is a serious issue that needs to be addressed and known to all.

I'm 90-95% certain that Upwork's "partner bank" is an extension of its business. I have no problem with this; but shylocking freelancers is not okay. At all. It's evident that Upwork's partner bank is trying to profit as much as possible from freelancers, even after the company deducts 20% of each project earnings and demands a withdrawal fee. This situation is unfair, and Upwork needs to rectify it.

My solution would be for Upwork to operate like every other online service on this aspect and allow the recipient bank to handle the exchange rate. No, I'm not referring to wire transfer because I know someone will reference this as a response. Fix this

[d26d5d29]

Good luck on getting Upwork to change any policy.

They have no means of user feedback, or any way for submitting a policy change request.

I posted for the very basic feature of being able to edit proposals or attachements until it is viewed by the client. No suitable response, then it was moved and buried into some other forum post.

You will propably get a 'copy-and-paste' reply, telling you to read some policy article on here.

[6bfcdaf8]

Upworks partner bank is actually a bank. This is an international transfer. You can prefer wire transfer option if you open a USD account and pay the bank fees. 

[eeeb8fb9]

It obviously has to be a bank, either wholly/partly owned by Upwork or has an agreement with it on how to handle exchange rates. The reason this is the case is because no other bank today will exchange USD for Ksh at such low rates. You can check for yourself to confirm this. None.

It's also possible that these unfair exchange rates do not apply to freelancers from the UK, EU, or other developed countries because I've never seen anyone from these areas complain.

Almost all frustrations are from freelancers in developing regions in Asia, Eastern Europe, and Africa.

As a publicly traded company, it is illogical and unsustainable way of making profits because you're harming the very people you depend on for revenues. It's a shortsighted approach driven by greed among the management.

And no, wire transfer, for the second time, is not a solution

[PradeepH]

Hi Desmond,

I am sorry to hear about how you feel. Alper is right, the currency conversion is performed by Upwork's banking partner at the time the funds are sent to you. These exchange rates include certain fees which are charged by most banks and financial institutions in addition to the exchange rates on the internet. This helps them cover the cost involved to process your fund withdrawal to your local banks. 

In case you are unhappy with the fees charged for fund withdrawal using the current payment method, you can try other fund withdrawal options available on your account.

Thank you,

Pradeep

[eeeb8fb9]

Hello Pradeep,

Thank you for your response.

However, I would like to clarify that I am not using exchange rates found on the internet, but rather actual bank exchange rates. For example, the exchange rate offered by KCB and Equity for USD to KES is significantly higher than the rate offered by your "partner bank." It appears that your partner bank's exchange rate is not reflective of the current market rates.

While I understand that withdrawal fees are an unavoidable cost (which is not the actual problem I was referencing btw), I am concerned about the absurdly low exchange rate being offered. Other online companies I have worked with, such as UvoCorp and Writerbay, allow the recipient institution to handle the exchange rate, which typically results in a more favorable rate.

While different banks may offer varying rates (again, none is offering KES123 for $1 other than your "partner bank," the minimum is 127), I believe it is reasonable to expect an exchange rate that more closely reflects the current market rate.

If there is any way to review the exchange rate being offered and make adjustments, it would be greatly appreciated.

If you've no control whatsoever or do not benefit in any way from your "partner" bank's way of doing business, then why not give us an option to let our banks handle the exchange rates? (not the wire transfer option).

[yofazza]

I don't think it's simple for Upwork to choose to let the rates be handled by the destination bank as you hoped to happen there.

I almost always take notes everytime I got money from someone abroad. I put them to a Google Sheet that'll calculate the "rate difference" with the current rate in our central bank. The worst rate is always with Xoom and Upwork interchangeably.

The best rate, the one that has the least difference than the rate in our central bank, and is not some "local bank", is Wise.

I've been reading that we can withdraw Upwork balance to Wise's USD Account, where we can transfer it to our local bank from there, where it is said it will still be better than withdrawing directly from Upwork. But I haven't got the urge to test it as my Upwork income isn't much, money difference from the rate difference isn't that significant. I'm also unsure if I can really create a Wise USD Account, how much the fees (if any), etc... It'll be great if someone experienced in this can share their views.

[6bfcdaf8]

Desmond, i see you are relatively new here, i just want you to know that i'd like to help you succeed. Upwork allows us to work with people from all over the world and the money we earn is collected through upwork. It is first stored in the US. And then you can have it transferred to your local bank account.

So the money will be travelling from US to your country, between 2 banks. Now there are multiple ways to do this, but there will be a cost. As you don't work for free, banks won't work for free either.

If you do a wire transfer, cost will be more transparent and visible to you, upworks bank will take 30usd, your local bank can also take some.

If you do a transfer in local currency, you may not directly see this cost as a fee, but it will be reflected as a currency exchange rate difference.

This is also same forexample if you travel to the US and want to use your local credit card, you can, but when you come back and look at your bill, the conversion currency rate will be much different than what you think.

So there's nothing unfair here. Your professional growth will start first by understanding this. Focus on making money first and don't worry so much about small expenses.

[40e6bc60]

this is laughable . as a seller there was a simple button in your setting which currency you want to be charged with. If I choose CAD and let upwork handle the exchange it will be 4% more expensive. You can argue with my bank how the transfer works and it will cost Upwork and its "partner bank" more to handle the exchange other than a canadian bank. You know what is more outrageous? when I called customer serviec they lied straight to my face. The told me the converstion was handled by my bank regardless. They probably just split the stolen 4% between themselves. There is the reason the company stock price is lower than its IPO. I'm moving over to its compeitions !