The three ways money reaches your account

When a client pays you, the money moves through one of three routes: a direct bank transfer (ACH in the US, or BACS in the UK), a payment processor (Stripe, PayPal, Square), or a check. Each one takes different time to clear, costs you different amounts, and requires different setup on your end. Most freelancers end up using two or all three, depending on who's paying them.

The route matters because it affects when you can actually spend the money. A bank transfer can take three to five business days. A payment processor usually clears in one to two business days but takes a percentage. A check can take five to ten business days and requires you to deposit it. If a client says they'll pay you Friday and you need the money Monday, the route they choose determines whether that's possible.

Key Takeaways

  • Bank transfers (ACH or BACS) are free but take three to five business days, so you need your routing and account number ready before you invoice.
  • Payment processors like Stripe or PayPal charge 2 to 3 percent per transaction but clear in one to two business days and work for clients who don't have your bank details.
  • Checks are free but the slowest option, taking five to ten business days from the time your client mails them.
  • You need a separate business bank account to keep client payments separate from personal spending and to make tax time simpler.
  • Invoice software that integrates with your payment method saves time and creates a record the IRS can follow.

Setting up a business bank account for client payments

Before you accept any payment, open a separate bank account in your business name. This is not optional if you want to stay organized. When tax time comes, you will have one account that contains only business income and business expenses. Your accountant will thank you, and the IRS will have a clear record if they ever ask.

Most banks let you open a business checking account online in about 15 minutes. You will need your Social Security Number or EIN (Employer Identification Number), a government ID, and your business name. If you are a sole proprietor, your business name can be your own name. If you have registered a business name with your state, bring that registration. The account usually costs nothing if you keep a minimum balance (often $500 to $1,000) or set up direct deposit.

Once the account is open, you will have a routing number and an account number. Write these down and keep them safe. You will give these to clients who want to pay you by bank transfer. Do not post them on your website or in public places — they are sensitive information that can be used to pull money from your account if someone has your name and these numbers.

Bank transfers: free but slower

A bank transfer (called ACH in the United States, BACS in the UK, or EFT in Canada) is money moving directly from your client's bank account to yours. It costs nothing. It is the safest method because the money comes from a real bank account, not a card or a third party. The downside is timing: it takes three to five business days for the money to actually land in your account.

To receive a bank transfer, give your client your routing number, account number, and the name on the account. Some clients will ask for a form — you can create a straightforward one that says "Please send payment to [your name] at [bank name], routing [number], account [number]." Others will just enter it into their own bank's payment system. Either way, once they initiate the transfer, you will see it pending in your account within a day, but it will not be available to spend for three to five business days.

Bank transfers work best when you have a regular client who pays you on a schedule. You can give them your details once, they set it up in their system, and the payment happens automatically every month. For one-off clients or clients who are not set up for business payments, a processor is often easier.

Payment processors: faster but they take a cut

A payment processor is a company that collects money from your client on your behalf and then sends it to your bank account. The most common ones are Stripe, PayPal, Square, and Wise. They charge you a percentage of each transaction — usually 2 to 3 percent plus a small fixed fee per transaction. In exchange, the money reaches your account in one to two business days, and your client can pay with a card, bank transfer, or other method without needing your bank details.

To use a processor, you sign up for an account, connect your bank account, and then share a payment link with your client. They click the link, enter their payment method, and the money is on its way. You can send the link via email, embed it on your website, or put it in an invoice. Most processors let you create an invoice directly in their system, which the client can pay from.

The fee matters when you are working with tight margins. If you charge $1,000 and use Stripe, you will receive about $970 after fees. If you charge $5,000, you will receive about $4,850. For high-value projects, you might ask the client to cover the fee or use a bank transfer instead. For smaller projects or clients you do not have a banking relationship with, the processor fee is worth the speed and convenience.

Checks: free but the slowest option

Some clients — especially larger companies or older organizations — still pay by check. A check is a written instruction to their bank to send you money. It costs them nothing and costs you nothing, but it is slow. You have to receive the check in the mail (one to three days), deposit it at your bank (either in person or by mobile app), and then wait for it to clear (five to seven business days). Total time from when they mail it to when you can spend the money: seven to ten business days.

To receive a check, give your client your mailing address and the name the check should be written to. Write it exactly as it appears on your business bank account. When the check arrives, you can deposit it by taking a photo with your phone (most banks offer mobile deposit) or by going to a branch. The bank will put a hold on the funds while it clears — you will see the deposit in your account right away, but you cannot spend it for five to seven business days.

If you need the money faster, ask the client to use a bank transfer or processor instead. If they insist on a check, ask them to mail it as soon as the invoice is due, not after they process it internally. This saves you a few days.

Invoicing so clients know how to pay you

An invoice is a document that tells your client what you did, what you are charging, and how to pay you. It should include your business name, address, and the payment method or methods you accept. If you accept bank transfers, list your routing and account number on the invoice (or say "bank transfer available upon request"). If you use a processor, include the payment link or a note that they can pay by card through your system.

Invoice software like FreshBooks, Wave, or Zoho saves time because it can send the invoice automatically, track whether the client has paid, and sometimes integrate directly with your payment processor. When you use integrated software, a client can click "pay now" in the invoice email and go straight to your payment page. This removes friction and gets you paid faster.

Number your invoices and keep copies. The IRS expects you to have a record of every payment you received. If you use software that integrates with your processor or bank, the records sync automatically. If you do not, keep a spreadsheet or folder with copies of every invoice and proof of payment.

What to do when a payment is late or does not arrive

If a client says they sent payment but you do not see it, ask them for proof — a screenshot of the confirmation, the transaction ID, or the check number. For bank transfers, the transaction ID lets you trace exactly where the money is. For processors, you can log in and see all incoming payments. For checks, ask them to stop payment and reissue if more than ten business days have passed.

If a client is late, send a polite reminder email referencing the invoice date and the payment method you agreed on. If they are very late (more than 30 days), you can charge a late fee if your contract says you will. Some freelancers require payment upfront or a deposit before starting work, which eliminates this problem entirely.

If a payment arrives but is the wrong amount, contact the client when ready. For bank transfers and checks, you can ask them to send the difference. For processor payments, the processor usually handles disputes, but you will need to contact them with proof of what you charged.

Frequently Asked Questions

Can I accept payment without a business bank account?

Technically yes, but you should not. Mixing personal and business money makes taxes harder and looks unprofessional to clients. A business account costs nothing if you maintain a small balance and takes 15 minutes to open online.

Which payment method should I offer first?

Bank transfer if you have regular clients who are set up for business payments. A payment processor if you work with many different clients or one-off projects. Both if you can manage them — it gives clients options and you get paid faster on average.

Do I have to pay taxes on money I receive as a freelancer?

Yes. All freelance income is taxable. Keep records of every payment you receive and every business expense you have. At tax time, you will report your total income and deduct your expenses to find your profit. The payment method does not change this — the IRS expects you to report all income regardless of how it arrived.

What happens if a client pays me through their personal account instead of a business account?

The money still reaches you the same way and clears on the same timeline. The only difference is that you are receiving payment from an individual rather than a company. This is common for small clients and does not change how you report the income.

Can I charge a fee if a client wants to pay by card?

You can ask them to cover the processor fee, but policies vary by location and by processor. Some processors allow you to pass the fee to the customer; others do not. Check your processor's terms. For bank transfers, you can offer a small discount to encourage clients to use that method instead, since it costs you nothing.