PayPal For Nonprofits Guide: What To Know About Using A PayPal Nonprofit Account

Adding a PayPal Donate button to your organization’s website and/or fundraising emails is quick and easy. To set up your Donate button, you’ll need to follow the steps outlined on PayPal’s developer page. You’ll be able to choose your button style, select the currency in which you receive donations, choose whether to let donors make recurring monthly donations, and more.

Another way to solicit online donations is to use PayPal.Me — PayPal’s peer-to-peer payment platform — to send personalized donation links to your donors. It’s a great way to approach your biggest supporters to ask for individual gifts.

Nonprofits can accept in-person donations via the PayPal Zettle mobile POS system. With PayPal Zettle, you get a modern chip + contactless + PIN card reader ($29 for the first reader, $79 for all subsequent readers). You’ll then be able to process in-person donations at big fundraising events, charity galas, etc.

Transactions processed by Zettle are subject to a 2.29% + $0.09 fee. Unfortunately, nonprofits cannot pay a discounted processing fee when using Zettle. Keyed-in transactions will be subject to a higher 3.49% + $0.09 fee.

You can also send out invoices via the PayPal Zettle app. Invoices are free to send, but when you get paid, you’ll be paying the 3.49% + $0.49 rate that PayPal charges for standard non-donation online transactions. What’s nice about the ability to send invoices is that for large donations (four figures or more), you can just send an invoice, thereby creating a paper trail. That can come in handy later!

Whether your nonprofit organization is running a charity auction or is selling branded merchandise at a gift shop or other “meet space” location, PayPal Zettle is a solid mobile processing option. Furthermore, if you need a POS system with more feature depth than Zettle, PayPal integrates with more robust POS systems as well.

The 2.29% + $0.09 PayPal rate for in-person transactions applies regardless of your POS partner, but you will incur additional software fees for the POS system itself.

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We’ve done in-depth testing of each and confidently recommend them.

PayPal’s reporting tools give you detailed information about your account activity and can assist your nonprofit with bookkeeping. Additionally, if your nonprofit processes $20,000 in gross payment volume from sales of goods or services in a single year and processes 200 payments for goods or services in the same year, PayPal will send Form 1099-K to both you and the IRS for that year early in the following year.

Furthermore, PayPal integrates with QuickBooks via the Connect to PayPal data integration app, available from your QuickBooks account.

QuickBooks Online	Visit Site Read our Review

Square has a lot to offer nonprofits as a payment processor.

While Square doesn’t offer discounted processing for nonprofits, its 2.6% + $0.10 per transaction rate for swiped, dipped, and tapped payments through the Square point of sale app is extremely competitive (Square’s online processing fee is 2.9% + $0.30).

Capturing donor info is easily done right from the transaction screen of the Square POS app, automatically adding your donors to your Customer Directory.

This is only the tip of the iceberg when it comes to Square’s nonprofit-friendly tools. Our Square review provides the full scoop, and if you’re looking for a direct Square vs PayPal comparison that takes a holistic look at both companies’ services, we have that as well.

Dharma Merchant Services is quite well-suited to nonprofits that take in more than $10,000 per month. Unlike the other PayPal nonprofit processing alternatives listed here, Dharma offers the stability of a full merchant account. It also offers discounted interchange-plus pricing for nonprofits, which should see you saving money over the likes of PayPal and Square.

As noted in our review of Dharma Merchant Services, Dharma doesn’t charge account setup fees, annual fees, or early termination fees. This sets Dharma apart from other traditional merchant account providers.

Dharma also provides more comprehensive customer support than PayPal.

Stripe is another PSP with plenty to offer nonprofit organizations that take donations online.

With a discounted nonprofit rate of 2.2% + $0.30 for most donations (donations made with Amex cards may process at a higher rate), custom donation forms, the option to offer a prefab hosted payment page, and a vast integration library, Stripe has much to offer nonprofits.

Check out our Stripe review for a full rundown.

eCommerce giant Shopify offers a number of features nonprofits will like, including discounted processing, recurring donations, event ticket sales, email marketing, in-person donations, and more. Our Shopify review has the full story on this massive platform.

Fundly is an online crowdfunding site that’s particularly suited for nonprofits as a PayPal alternative, as your fundraising page is completely customizable. You’ll have easy social sharing integrations, intuitive management tools, and the ability to offer perks to donors, depending on their level of support.

There’s a 2.9% + $0.30 fee charged to each transaction, and Fundly has no platform fee.

Donorbox is a solid fundraising option for nonprofits seeking to accept recurring donations, collect donor data, make customizable donation forms, and more. Donorbox integrates with a wide range of website builders, CRM providers, and email marketing tools.

Donorbox’s 1.5% flat fee for donations is one of the lowest in the industry, and you can ask your donors to cover the transaction fee. Custom plans are available for larger organizations.

Qgiv’s online fundraising platform is another PayPal alternative worth your consideration from a nonprofit standpoint. Qgiv’s donation forms are fully customizable (much more so than PayPal’s donation forms) and mobile-responsive. The platform allows for recurring gifts to encourage donors. Qgiv even provides an auction platform and event management capabilities from its app.

Qgiv’s pricing and fees vary depending on the level of service you need — just know that there will be a monthly fee.

While GoFundMe is known as a personal crowdfunding platform, it also supports nonprofit fundraising.

As we note in our GoFundMe review, you can launch an unlimited number of campaigns, access basic donor data, and set up team fundraising pages, all without paying a monthly fee or a platform fee (just a 2.9% + $0.30 processing fee).

Alternatively, you can sign up for GoFundMe’s new charity fundraising service, which replaces its old CrowdRise platform. Details are scant at this point, so you’ll have to ask GoFundMe for more information.

If you use PayPal Checkout to accept payments, you won’t pay any monthly fee to accept payments through PayPal as a nonprofit.

As for transaction fees, registered 501(c)(3) nonprofit organizations can take online donations through PayPal at a discounted rate of 1.99% + $0.49 per transaction.

If your organization does not yet have 501(c)(3) status, you can still take donations, but they will process at a rate of 2.89%+ $0.49/transaction.

Beyond giving you nonprofit donation buttons to put on your site, PayPal can enable your organization to take donations in person, accept recurring donations, sell merchandise at events, and integrate with a wide range of specialized apps for email marketing, donor management, event ticket sales, and much more.

Venmo has a decent package to offer nonprofits. It offers a lower nonprofit donation processing rate than PayPal itself: 1.9% + $0.10 per transaction. If you’re simply looking for the lowest nonprofit processing rate, you might want to go with Venmo.

Venmo offers some other nonprofit-friendly tools, but it’s not suited to larger nonprofits seeking to integrate with other fundraising software or accept recurring donations.