I am new to freelancing and recently placed a bid for one project. Project owner is asking for me to pay the deposit before work is started. They said it is refundable amount.

Is it safe to do so?

If you are performing the work and they are hiring you, there's no reason on Earth you should be paying them anything for any reason.

Without knowing the customs in all countries, on the face of it - this sounds fishy. What is their argument for wanting you to deposit money before working? I cannot even make up a legitimate reason. YOU are the freelancer, so the cash should generally flow from the client to you.

It should actually be the other way around; you perform or deliver no work before some payment has been secured.

Do not be appeased by the term 'refundable'; once you have paid money, it can be impossible to get back. Non-payment is a very common weapon used against (inexperienced) freelancers; do everything you can to prevent this from happening to yourself.

If there is a legitimate reason and you decide to go along, you must ensure that the deposit is placed at a verifiably independant third party - and that a contract states when money is refunded.

It's absolutely the converse, they should make the deposit!

Most of the freelancing sites propose an escrow policy such that you are guaranteed to be paid if you've done the work. In case of problems, the litigation is between the customer and the site, not you.

First of all, ask this question from yourself. why they need money? you are doing something for them so they have to pay the money. in the worst situation, they can pay after finishing the project. by the way, I highly recommend you, always take some money as a deposit (or any other name) in advance before you start to work.

No, it is not safe and is not at all advisable since those will have your personal information + some means of payment... As far as I know, no country can demand a "benevolently" handed money to be refunded... Don't do it!

If you want to be a freelancer, then you should do your due diligence in researching topics such as this.

There are similar stories for the past 10 months, maybe a year, where freelancers were conned to pay something to start work. They were all scammed.

Sometimes there were asking for the costs of the work permit, other times something else.

But in order to do any freelancer work, you will NOT be asked to pay ANYTHING in advance.

The only type of work that may require a deposit is government work. This may be some kind of bond that you pay and submit with an official bid, in case you back out at the last minute and they have to resubmit the request for proposal again.

The thing is that this may cause them to get no bids, in which case, they will resubmit the RFQ without the requirement. If you were to win the bid and sign the contract, the bond would be refunded to you. After that, you can fail at the project and they can take you to court unless a remedy is in writing already on that contract.

The penalty could be something like this: You would owe the city, county or state 10% of the contract or you would pay the difference between your contract (the lowest bid) and the next lowest bid.

Your Answer

 

By clicking "Post Your Answer", you acknowledge that you have read our updated terms of service, privacy policy and cookie policy, and that your continued use of the website is subject to these policies.

Not the answer you're looking for? Browse other questions tagged or ask your own question.