Getting Paid with In Text Ads on a Website

The Payment Threshold and the Waiting Period

Once a visitor to your website hovered over a double underline link and clicked on the ad within the bubble, you’ve already earned advertising revenues – it can be as low as a few cents, but money is money, right? So why don’t you get paid immediately? Well, handling payments takes efforts and costs, and if we’ll create a transaction for every cent earned, the costs will be higher than the earnings. Also, the online advertising cycle requires several offline procedures to ensure the validity of the ads served and visitors clicking, so some patience is required.

In text ads providers, like other ad networks including Google AdSense, set a minimum sum for payout, often called the payment threshold. As a website publisher you get paid only after your earnings reach this number. And then, payments go out in cycles, mostly on a monthly basis, so you need to wait a little longer. In order for you to get paid, you first need to get to the payment threshold and then also wait for the monthly payment cycle to arrive.

Let’s take an example with customary numbers: the payment threshold is $100 and the payment cycle is monthly, with a waiting period of 30 days during which the provider collects payments from advertisers and makes all necessary calculations and procedures. If in July you’ve earned $65, then you’re still not entitled for payment because your earnings are lower than the payment threshold. This sum is therefore carried over to the next month. Then, in August your website yielded another $80. Although this is still lower than the payment threshold, you already have pending balance from the previous month, and together you have $145, which makes you entitled for payout. Now, from the end of August you need to wait 30 days and expect payment by the end of September.

Just to avoid a common mistake, your September earnings will not be included in the payment at the end of September but only 30 days later. Accordingly, even if during September you’ve earned another $300, these earnings will only be reflected in the following payment, at the end of October.

Payment Methods and Transaction Fees

Although most money in the world today is in the form of bits of information in various types of banking accounts, which theoretically can travel at the speed of light, it can still prove to be quite difficult getting your website revenues from the online advertising provider. Also, some forms of payment include charges of high transaction fees.

If both you and the provider are in the US, the best form of payment – in terms of speed, comfort and costs – is ACH. It is very much like a traditional wire transfer directly between bank accounts but with much lower commissions and transaction fees; in fact, they are close to zero. If you have a bank account in the US, you should ask your provider to use ACH.

In some cases, using ACH is limited to high volume transfers. If you don’t qualify for it, ask your provider if it’s possible to hold your payments until you reach the minimum sum for ACH. If you can afford the wait, the minimal costs can be worth it.

International Payments

Outside the US, the most common form for online transfers is PayPal. The advantages are transparency and safety. The disadvantages are high service commissions and severe limitations in certain countries. In small transfers, PayPal is a wise choice. If your earnings get into hundreds and thousands, you should consider alternatives to save on the commissions. Also, in some countries, like Chile and Pakistan, you simply can’t work with PayPal, while in other countries you can work with them but find it very difficult to withdraw your money… in these cases, you must consider the alternatives.

Since payment methods are not the focus here, I won’t include reviews of PayPal alternatives and competitors. From my experience, I can say that wire transfers directly between bank accounts is relevant only to big numbers, as they involve a headache of details and commissions. For smaller amounts where PayPal is not available, a good alternative cab be Payoneer, which sends money directly to MasterCard debit cards that are accepted worldwide, and there are other options as well.

Tax Forms

As it happens, all major in text ads providers operate out of the US and are therefore subject to the IRS tax regulations. As such, to receive payments from them, the website publisher needs to fill out a form that transfers the responsibility for tax payments to the publisher. This is true even if the publisher is not located in the US. Be sure to submit the relevant form to guarantee that your payment is not delayed.

If you don’t have any business in the US you can replace the IRS form with a formal declaration about having no business or income in the US.

If your in text ads provider is located in another country, the tax requirements will be different, so take it into consideration.

Small Website Warning

Some blogs and websites earn only smaller monthly sums, but still – it can accumulate to significant amounts and can at least cover your costs. When choosing your provider, check what the payment threshold is, so that your earnings won’t get stuck with the provider for too long. More important, some in text providers tend to discriminate smaller publishers in the fine print… for example, the terms may state that if you haven’t reached a minimum sum in a certain month, your earnings will be lost entirely. Even for a bigger website, if you have a slower month or your website was under construction, you may find yourself losing revenues that your website had rightfully produced. Make sure you don’t fall into such a trap.

Big Website Warning

When your website monetization entitles you to high payouts, you should be aware of high transaction costs. Even if you got used to PayPal, the commissions there can be significantly higher compared to ACH or wire transfers, so with growth – you should also look into your choice of payment method.