How to Pay International Contractors from Canada

A Vancouver design agency pays six freelance illustrators across four countries. Two prefer bank deposits. One wants PayPal. Another asks for Wise. The fifth and sixth — both in Southeast Asia — have started requesting USDC because bank wires take too long and eat into their earnings.

The finance manager now runs four different payment workflows every month. Each has its own fee structure, its own timeline, its own reconciliation process. And every time a contractor switches their preferred method, the manager has to figure out whether the new option is actually better — or just different.

This guide compares five ways to pay international contractors from Canada: bank wire transfers, Wise, PayPal, stablecoins (USDC/USDT), and employer-of-record services. For each method, we cover cost, speed, geographic reach, compliance considerations, and the type of contractor it works best for. The goal is not to declare one "winner" — it is to give you a framework for choosing the right tool for each person on your team.

Method 1: Bank Wire Transfer (SWIFT) to Pay Contractors

How It Works

You log into your Canadian business bank account, enter the contractor's SWIFT/BIC code, IBAN or account number, bank name and address, and the payment amount. The bank debits your CAD account, converts to the destination currency at whatever rate the bank's treasury desk applies that day, and routes the payment through the SWIFT network. The payment passes through one or more intermediary banks before reaching the contractor's local bank.

Costs

Cost Type	Typical Range
Outgoing wire fee (Canadian bank)	$15–$50 per transfer
Exchange rate spread (hidden markup)	1.5–3% above institutional rate
Intermediary bank deductions	$10–$30 per wire (unpredictable)
Recipient incoming wire fee	$10–$25 (charged by contractor's bank)
Total cost on a $2,000 CAD payment	$55–$165

Speed

3–5 business days. Weekends and Canadian or local holidays add time. A payment sent Friday afternoon may not arrive until the following Wednesday or Thursday.

Best For

One-off or infrequent payments where setup simplicity matters more than cost
Contractors in countries with limited digital payment infrastructure
When the contractor's bank account details are the only payment information you have

Limitations

Cost scales linearly with payment frequency. Ten contractors paid monthly = $150–$500 in wire fees alone, before FX costs.
The amount the contractor receives is not the amount you sent. Intermediary deductions are unpredictable and unrecoverable.
SWIFT codes, IBANs, and intermediary bank details mean manual data entry — and manual errors mean failed or delayed transfers.

Method 2: Wise (TransferWise) Business for Contractors Paying

How It Works

Wise holds local currency accounts in multiple countries. When you send a payment, Wise matches it against someone sending money in the opposite direction. Your CAD never actually crosses a border — Wise pays the contractor from its local currency balance in their country. This avoids the SWIFT chain entirely.

Costs

Wise charges a transparent, upfront fee that includes the exchange rate spread. Fees vary by currency pair and amount but typically range from 0.3% to 1.5% — significantly lower than bank wire spreads. There is no intermediary bank deduction because the payment uses local rails. The fee is displayed before you confirm the transfer.

Speed

Same-day to 2 business days, depending on the destination currency and payment method. Payments to major currencies (EUR, GBP, USD) often arrive within hours.

Best For

Businesses paying contractors in countries where Wise holds local accounts (UK, EU, US, Australia, and several others)
Payments where receiving local currency directly in a bank account is the priority
Finance teams that value upfront fee transparency over "trust the bank's rate"

Limitations

Wise's local currency coverage is narrower than SWIFT. Contractors in smaller markets may not be supported.
Transaction limits apply — high-volume payroll runs may hit caps.
Wise is not a full treasury or multi-currency management platform. It handles payments, not cash flow visibility across currencies.

Method 3: PayPal Business to Pay Internationally

How It Works

You fund your PayPal business account from your Canadian bank or credit card. You send a payment to the contractor's PayPal email address. The contractor receives the funds in their PayPal account and withdraws to their local bank.

Costs

PayPal's international payment fees are higher than most businesses realize:

Cost Type	Typical Range
International transaction fee	3.49%–4.99% + fixed fee per transaction
Currency conversion spread	3–4% above base rate (applied by PayPal)
Recipient withdrawal fee	Varies by country (often $0–$5)
Total cost on a $2,000 CAD payment	$130–$200

Speed

Instant to the contractor's PayPal balance. Withdrawal to their bank account takes 1–3 business days, depending on the country.

Best For

Small, ad-hoc payments under a few hundred dollars
Contractors who already use PayPal and prefer it
When speed to the contractor's PayPal balance is more important than total cost

Limitations

The most expensive option at scale. On $5,000 in monthly contractor payments, fees can exceed $200.
PayPal is not universally available — it does not operate in every country.
PayPal accounts can be frozen or limited, and dispute resolution is opaque. This is a meaningful risk when contractor relationships depend on reliable payment delivery.

Method 4: Stablecoins (USDC and USDT) Payment to International Contractors

How It Works

You fund a multi-currency business account (e.g., PhotonPay) in CAD. The platform converts CAD to USDC or USDT at institutional exchange rates. You enter the contractor's wallet address — USDC on Ethereum (ERC-20) or USDT on TRON (TRC-20) — and send. Settlement happens on-chain within minutes. The contractor receives dollar-pegged digital currency that maintains $1 USD value. They can convert to local currency through a local exchange, or spend it.

Costs

Cost Type	Typical Range
Platform exchange spread	0.1–0.5% (transparent)
Blockchain gas fee	$0.05–$5 per transaction
Intermediary deductions	$0
Recipient receiving cost	$0 (wallet-to-wallet)
Total cost on a $2,000 CAD payment	$3–$15

Speed

Under 5 minutes for on-chain settlement. Contractors can access funds immediately. No weekend or holiday delays — the blockchain operates 24/7/365.

Best For

Businesses paying 5+ international contractors per pay period — the per-transaction cost savings compound quickly
Contractors in regions with high stablecoin adoption: Southeast Asia (Philippines, Vietnam), Latin America (Brazil, Argentina), Africa (Nigeria, Kenya)
Payroll runs that frequently hit weekends or holidays
Contractors who have explicitly asked for faster, cheaper payment options

Limitations

The contractor needs a digital wallet. For those without one, the hybrid approach (stablecoin backend → local fiat payout) is an option if the platform supports it.
Blockchain transactions are irreversible. Sending to the wrong wallet address means lost funds — the same as sending a wire to the wrong account. Always verify wallet addresses before sending.
USDC is only available on Ethereum (ERC-20) through PhotonPay; USDT is only available on TRON (TRC-20). Match the network to what the contractor can receive.

Method 5: Employer of Record (EOR) — Deel, Remote, Oyster

How It Works

An EOR is not a payment method — it is an employment infrastructure service. The EOR legally employs your contractor (or full-time worker) in their country of residence, handling local payroll, tax withholding, benefits, and compliance. You pay the EOR one invoice. The EOR pays the worker according to local labor law.

Costs

EOR services typically charge $500–$800 per worker per month, plus employment-related costs (statutory benefits, payroll taxes, insurance). This is orders of magnitude more expensive than any payment method — because it is not a payment method. It is full employment compliance.

Best For

Full-time employees in countries where you do not have a legal entity
Workers in jurisdictions with complex labor laws that create compliance risk
When you need to offer local benefits, paid leave, and statutory protections

Limitations

Massively overbuilt for contractor payments. If the worker is genuinely a contractor handling their own taxes, an EOR adds cost without adding value.
Per-worker monthly fees make it impractical for businesses with large contractor teams.

Side-by-Side Comparison

	Bank Wire	Wise	PayPal	Stablecoins（PhotonPay）	EOR
Cost per $2,000 payment	$55–$165	$6–$30	$130–$200	$3–$15	$500–$800/mo
Speed	3–5 days	Hours–2 days	Instant (balance)	Under 5 min	Monthly cycle
Global reach	200+ countries	50+ countries	200+ countries	180+ countries	150+ countries
FX transparency	Hidden spread	Upfront fee	Hidden spread	Transparent	N/A
Batch payments	Manual only	Limited	Manual only	Built-in	Included
Canadian compliance	Bank-regulated	Regulated	Regulated	FINTRAC MSB	Local entities
Best for	One-off payments	Major currencies	Small amounts	Frequent, global	Full employees

How to Choose: A Decision Framework

Run each contractor through these four questions:

1. How many contractors are you paying, and how often?

If the answer is 5+ contractors per pay period, the cost difference compounds. At 15 contractors paid twice a month (30 payments), bank wires cost $1,650–$4,950/month in fees and hidden spreads. Stablecoin-based settlement costs $90–$450/month. The difference pays for itself in the first month.

2. What payment method does the contractor actually want?

This matters more than any cost comparison. A contractor who insists on PayPal will not switch to USDC — and forcing them to will damage the relationship. Ask what they prefer. If they are open to options, share the speed and cost differences. Let them decide.

3. Where is the contractor located?

Contractors in the Philippines, Vietnam, Nigeria, or Brazil often prefer stablecoins because local banking infrastructure adds delays and fees. Contractors in the UK, Germany, or Australia typically have smooth bank-to-bank options through SEPA or local clearing. Geographic context determines which methods are actually faster and cheaper in practice.

4. Is the worker a contractor or an employee?

If the worker is functionally a full-time employee, no payment method solves the compliance problem. You need an EOR or a local entity. If they are genuinely a contractor managing their own taxes and business operations, choose the payment method that optimizes for cost and speed.

Canadian Compliance Checklist for Contractor Payments

Regardless of which payment method you choose, Canadian businesses paying international contractors must address:

T4A reporting: Issue T4A slips for contractor payments exceeding $500 in a calendar year. Report the CAD equivalent using the Bank of Canada exchange rate on the payment date.
Withholding tax (Regulation 105): Payments to non-resident contractors for services performed in Canada may be subject to 15% withholding. Payments for services performed outside Canada generally are not.
GST/HST: Contractors outside Canada do not charge GST/HST. Contractors inside Canada may, depending on their registration status.
FINTRAC: If processing payments through a money services business, verify the platform is registered with FINTRAC. This is the platform's obligation, but your due diligence.
Record keeping: Retain payment records — amounts, dates, exchange rates, contractor invoices — for six years, as required by the CRA.
Sanctions screening: Ensure your payment platform screens transactions against Canadian sanctions lists. This should be automated, not manual.

PhotonPay for International Contractor Payments

PhotonPay provides Canadian businesses with a unified platform for paying international contractors across multiple methods:

Multi-currency accounts (60+ currencies): Fund in CAD. Pay out in the contractor's local currency — PHP, VND, BRL, INR, EUR — or in stablecoins. Hold balances across currencies in one dashboard.
Batch payments: One upload for your entire contractor pay run. Configure each contractor's amount, currency, and payment method in a single batch file. Approve once — all payments process simultaneously.
Stablecoin settlement: For contractors who prefer digital dollars, stablecoin payments settle in minutes at a fraction of wire transfer costs. The contractor receives dollar-pegged value they can hold, convert, or spend.
FINTRAC-compliant operations: Automated sanctions screening, transaction monitoring, and regulatory reporting built into the payment flow.
Transparent FX: Institutional exchange rates with visible spreads. No hidden bank markup folded into the rate.

Summary

Paying international contractors from Canada is not one problem with one solution — it is a portfolio of payment relationships, each with different geography, preferences, and constraints. The right method for your designer in London may be the wrong method for your sourcing agent in Ho Chi Minh City.

Bank wires work for infrequent, one-off payments where setup simplicity matters more than cost. Wise is strong for major-currency destinations where local account coverage exists. PayPal is convenient for small, ad-hoc payments — and expensive at any meaningful scale. Stablecoins compress the cost-and-speed equation for frequent payments to contractors in high-adoption regions, settling in minutes at near-zero cost. EOR services exist for full employment relationships, not contractor payments — use them when compliance requires it, not when payment delivery is the only problem.

The finance manager in Vancouver running four payment workflows every month? She can run one. A multi-currency business account with batch payment capability and stablecoin settlement which replaces four workflows with a single dashboard — without forcing every contractor onto the same method.