You want to collect donations from your website with credit cards, but what does that really mean? What are PayPal’s fees and how much does it really cost?
What is a payment gateway?
In order to collect donations from your website, you will need to be able to accept credit cards on your website. The tool used to process credit cards online is called a payment gateway.
In the past, you needed to set up a merchant account with your bank to accept credit cards — in person or online. Fortunately, those days are behind us. Payment gateways, like PayPal have led the way for merchants and nonprofits alike to accept payment (donations) online. There are other payment gateways, too, like Stripe, Authorize.net and GoCardless. Regardless of which payment gateway you choose to accept credit cards online, you will need a payment gateway.
Why do you need a payment gateway?
As a nonprofit, you can always take offline donations (people mailing you checks or handing you cash). So, maybe you don’t need a payment gateway. But the good thing about a payment gateway like PayPal, Stripe, or 2Checkout is that they take on the security surrounding PCI compliance and, more importantly, assume the risk.
“Payment security is paramount for every merchant, financial institution or other entity that stores, processes or transmits cardholder data. The PCI Data Security Standards help protect the safety of that data. They set the operational and technical requirements for organizations accepting or processing payment transactions, and for software developers and manufacturers of applications and devices used in those transactions.” PCI Security Standards Council
“Payment gateways have been leading the way and pushing security.” Chris Teitzel of Lockr
How much does PayPal charge in fees?
The short answer is thirty cents and 2.9% per transaction. If you’re an official nonprofit (meaning, you have the 501(c)(3) designation from the Internal Revenue Service), you can sign up for their discounted rates.
“PayPal fees are always fair. Buying is free with us when you purchase in the U.S. When you sell with us, you get some of the most competitive rates in the business. It’s 2.9% + $0.30 per transaction. The proof is in the percentages below.”
For donations, PayPal has discounted rates. PayPal for donations says,
“PayPal offers discounted transaction rates for 501(c)(3) charities for most products, and consistently low rates for all other nonprofits. No extra fees for setup, statements, withdrawals or cancellation. 2.2% + $0.30 per transaction and no monthly fee for charities.”
Payment gateways always have processing fees. They are transferring money to your nonprofit organization’s bank on your behalf. Where you can save money with online donations isn’t on processing fees, it is the fundraising platform you choose. Meaning, does your fundraising platform take a commission in addition to the payment gateway processing fees? Most do. (Give doesn’t.)
Which payment gateways does Give support?
PayPal is the most widely known payment gateway as a brand, but not the only one — by far. We have several payment gateways available. Currently, Give Core uses PayPal Standard right out of the box — for no additional charge to you.
Because many of our customers need options to meet the needs of their growing nonprofits, we also have a variety of Add-ons. These Add-ons are available separately for a small annual license fee that gives you access to updates and priority support. They can also be purchased in a bundle if that is more convenient.
Our current list of payment gateways include: PayPal Pro, Stripe, Authorize.net, iATS Payments, 2Checkout, Braintree, CC Avenue, PayU Money, Dwolla, RazorPay, and Paymill. Because of international banking requirements or specific nonprofit needs we are continuously adding new payment gateways, so be sure to bookmark this page.
What is the breakdown on payment gateway fees?
PayPal is great and in many ways is a leader in the industry. But it’s not the only payment gateway. As a nonprofit, you have many options. Every payment gateway has their own set of fees and some even have discounts for registered nonprofit organizations to take off some of the burden of fundraising.
Here are a few of our favorite gateways and their fees:
Our disclaimer is that these fees change.
- PayPal 2.9% + 30¢ per transaction
- PayPal Pro varies depending upon volume. $30 monthly plus a minimum of 2.9% + 30¢ per transaction
- Stripe 2.9% + 30¢ per transaction
- Authorize.net 2.9% + 30¢ per transaction plus $45 setup fee and $25 monthly.
- 2Checkout pricing depends upon your country but is 2.9% + 30¢ per transaction for the United States
It’s okay to be confused. You’re not expected to be the experts; that’s our job.
We’re here to help you make the choices that are best for your organization and its needs. WordPress allows you freedom to own your data and Give supports that vision.