The Complete Guide To Square Nonprofit Fundraising & Donation Tools

It’s a strange time for nonprofits, with charitable giving increasing in 2020/2021 at the same time as the average organization saw its fundraising revenue drop. The donors are out there, but funneling money into your nonprofit may be trickier than in the past.

One way to expand your reach is to use a payment service like Square, and if you are looking to expand fundraising possibilities for your nonprofit and are considering Square for accepting donations, you may have a lot of questions. Fortunately, you’ve come to the right place; this post covers all the information you’ll need to make an educated decision about using Square for donations for your nonprofit. We’ll look at the costs, fees, and all of the features that await you behind the curtain of Square’s processing.

Let’s get started!

Why Should Charities Use Square Nonprofit Tools?

Square nonprofit tools offer powerful features at a competitive price with no surprise fees or markups on the back end.

Advantages Of Using Square For Nonprofits

Here are some of the highlights of using Square for charities:

The Limitations Of Using Square For Nonprofits

Using Square for nonprofit donations offers a plethora of benefits, but it’s not without some potential hiccups.

Square Fees & Rates For Nonprofits

Unfortunately, Square does not waive any fees or offer a specific charity discount to nonprofits. Nonprofits pay the exact same rates as for-profit businesses. However, Square provides all of its standard software free to all users and requires no long-term commitment. Your actual transaction processing fees depend on which method you use to accept the payment.

Here are Square’s nonprofit rates:

• 2.6% + $0.10 for any tapped, dipped, or swiped transactions for in-person donations
•  3.5% + $0.15 when you enter in a credit card number manually from the Square POS app, take payment in your Square Virtual Terminal, and process card-on-file transactions, including recurring invoices
• 2.9% + $0.30 for contributions made through a Square donation button, invoice, or Square online store

You can learn a bit more about Square’s pricing in our article The Complete Guide To Square Costs For Payment Processing & Software.

Square’s base rates are designed for organizations that process less than $250,000 per year. Does your charity have higher projected donations coming in? Square may create a custom Square nonprofit pricing package for charities and small businesses that process more than $250,000 per year in sales; the company considers that on a case-by-case basis rather than offering any sort of standard discount for nonprofits.

How To Set Up Square For A Nonprofit

If you’re not anticipating a high volume of credit card sales ($250,000+), you can signup for Square for nonprofits on your own through the company’s website. While you can still technically do it this way if you’re high-volume, you might be missing out on some perks you could negotiate by speaking to a representative about Square donations.

To get started with Square’s setup for nonprofits, you’ll click Get Started on the website and follow the instructions given. To make this process go more smoothly, you should have the following handy:

• Full names for each account holder
• The main account holder’s Social Security Number
• Date of birth of the main account holder
• EIN number if applicable

Who the main account holder is is up to you, but you probably want it to be someone tied to the management of your organization’s finances. Once you’ve given Square the relevant information, you can link your org’s bank account to your Square account.

Using Square For Nonprofits: 9 Ways To Improve Donations & Fundraising

Square offers so much more than just payment processing. Its tools include everything you need for in-person and online payment processing, donor management, and event registration. Here’s how you can use Square nonprofit tools to make your donation and fundraising efforts more effective.

1. Accept Donations Online With Square

You have quite a few options to accept donations online with Square. The easiest option is to create a free Square site with ready-made templates that make it easy to build a simple web storefront. You can create a space that explains your mission and lets your donors contribute to the cause, or make a fully functional eCommerce store that allows you to sell things, such as t-shirts and other merchandise, to support your organization and mission. If you have multiple focuses for your nonprofit, you can create more than one campaign on your site.

If you already have a site, you can choose from one of the plugin integrations for Square at your dashboard for easy setup.

If you’ve got some expertise when it comes to code (or have a developer on staff), you can build a branded checkout flow with the Square Transactions API that allows you to accept digital wallets, too. Check out our article on how to accept online payments with Square for a full, in-depth explanation of each of these possibilities and a few more (such as in-app purchases).

Creating A Square Donate Button Without A Website

If you don’t have your own site, you can still use Square Online Checkout. Using this set of tools, you can actually create Square-powered donation buttons that you can embed in emails, texts, or even on social media. This allows you to create fundraising campaigns that reach further and work across all of your marketing channels.

Read more about how it works in our full post, What Is Square Online Checkout? Your Guide To Using This New Square Payment Option.

2. Use Square For In-Person Donations & Fundraising

Hoping people have cash on hand or the even more archaic option of a check can limit you at an in-person charity event. Instead, Square fundraising tools include the option to use Square’s free POS and mobile card reader to accept donations via credit or debit card.

Square offers a number of convenient NFC-compatible terminals and readers that make it easy to take payments in person, whether you’re at your base of operations, at an event, or even on the go.

3. Take Donations & Orders Over The Phone

Like most other software options for point of sale, Square comes with a virtual terminal right on your dashboard. The virtual terminal allows you to accept payments over the phone or manually key in credit card data. What’s important to understand here is that a virtual terminal is really the only way to process credit card data safely over the phone. That’s because when you receive credit card information, security has to be considered during transmission and storage.

Using Square’s virtual terminal for donations is easy. You simply enter the credit card data in the form, along with any other information you collect. Since the full credit card number isn’t visible once you key it in, you never have to worry about this information being vulnerable. You can even store donor information and see a full history of their contributions. Just be aware that this is the most costly way to accept donations through Square, so you’ll probably only want to use it when no other option is available.

4. Set Up Recurring Donations With Square

As a charity, there is probably nothing that feels better than an ongoing commitment from your supporters. These folks help you keep up your daily operations and allow you to plan for future growth. Square makes setting up recurring donations super easy for your charity. Whether you’re on your mobile device or at your full Square dashboard on your PC, you can create what you need.

Check out the full post, How To Use Square For Recurring Payments & Invoices, for information on integrations or a prebuilt workflow for Square donations.

5. Sell Merchandise With Square POS & Store

Ready to sell merch at your fundraising event or want to offer an online store to supplement your donations? Square works for nonprofits by providing a free store or the option to upgrade to a more advanced eCommerce site. Your inventory also syncs seamlessly with Square Point of Sale so that you can launch a one-time pop-up store or a full-fledged gift shop.

Square POS allows nonprofits to accept payments for charity auction items right then and there (or send an invoice for payment after the event). You can also set up alerts on your dashboard to stay on top of any dwindling merchandise you offer. That way, you can re-order supplies before stock drops to zero!

6. Use Square To Manage Fundraising Events & Registration

Planning an event for your charity can help you connect with both your current and future supporters. That’s why I’m glad to see that Square’s nonprofit tools include the option to sell tickets for any event you have in the works. You’ll do this through your online store. You can set up your tickets for electronic delivery, in-person pickup, or you can print for shipping. Square gives step-by-step information on how to sell event tickets through its help center.

Square also has a partnership with Eventbrite, so it’s that much easier to organize, manage your event, and sell your tickets.

7. Track Your Income & Improve Your Bookkeeping

Square offers simple income tracking. You can download sales history, view deposits, and see everything that’s happening over a set period.

You can income by categories, such as merchandise sales, donations, or ticket sales. If you rely heavily on Square donation tools for your income, there are other tools to analyze donor patterns. You can also compare new givers with long-time supporters and average donation size.

Need something more? One thing to note is that Square integrates with QuickBooks, so you can sync sales data and get the sales or expense reports you need all in one place. QuickBooks has some specialized accounting features for nonprofits, which can make it a must-have piece of software.

8. Collect Donor Information & Engage

Ready to do some more analysis of your Square donations data and use it to improve engagement? You can export a list of your donations or the details about your donors from your online store at any time.

As you collect donations through Square, you can populate the standard customer data profile and enter any custom notes about your supporters. Because an email address is one of the standard pieces of profile data, you can also build a robust email list for future marketing.

Square has a few customer engagement features that are completely free. The emails that you collect during transactions are yours to add to a separate email campaign service, of course. You can also create, import, and manage all of your customer profiles within your Customer Directory. You can then use that data to get more insights into your donors and plan future giving campaigns.

9. Go Digital With Cash App For Nonprofits

While the app is still owned and run by Square, Cash App is also very much an independent product at this point. Cash App is a peer-to-peer payments platform, meaning it’s designed to move money from one entity to another, making it a simple way to handle a small volume of payments without the bloat of a full POS system.

One of the big appeals of Cash App for nonprofits is the ability to make a “cashtag,” a unique identifying link that anyone can click on to send you money. The link will have the format: cash.app/$Your_Unique_Identity.

Cash App accounts are personal by default, but you can switch it over to business within the settings. Business transactions are charged 2.75% through Cash App.

Alternatives To Square For Nonprofits

Square has a lot to offer nonprofits, but it may not be an ideal fit for every organization. Here are some payment processing alternatives charities can use for donations.

• Dharma Merchant Services: Nonprofits that handle a higher volume of transactions may want to consider Dharma Merchant Services. For $20/month you’ll get a dedicated merchant account, which is more stable and less prone to account freezes than third-party processors like Square, Stripe, and PayPal. Qualified nonprofits can get a discounted processing rate of interchange + 0.10% + $0.08 for in-person transactions, and interchange + 0.10% + $0.11 for virtual transactions.
• Stripe: Stripe is an eCommerce-focused platform with a number of similarities to Square. Like Square, Stripe offers a one-stop shop approach to payment services, but its focus is centered more on online transactions and security than hardware and productivity software. Nonprofits that take most of their donations online may find that Stripe offers a couple of advantages over Square, namely support for international transactions and a discounted processing fee for 501(c)(3) organizations. This works out to 2.2% + $0.30 for most transactions.
• PayPal: You’ve probably heard of PayPal. Like Stripe, PayPal is an eCommerce-focused platform, so it will be of interest primarily to businesses that take online donations. PayPal’s ecosystem is absolutely massive, featuring peer-to-peer transaction support as in-person transactions through PayPal Zettle. Registered 501(c)(3) organizations are charged 1.99% + $0.49 for online transactions.

Is Square Right For Your Nonprofit Or Charity?

Square’s tools for fundraising are a great option for most nonprofits. You can start taking donations — and even have access to a few ways to grow — without having to spend any extra money right off the bat. However, for advanced reporting features, marketing, and other integrations you may need, you’re going to pay more each month. So while it’s possible you’ll eventually outgrow Square, it’s not a bad place to start.

While Square does not offer any special discounts for charities, the processing fees are competitive. And with all of the freebies, it’s a bit remarkable for a processor overall. However, be aware that account stability issues exist, but they aren’t unique to Square by any means — using any third-party processor for donations involves a certain amount of risk. Check out our full Square review so that you understand how to make the most of this option.

Not sure if Square is right for you (or already sure it isn’t)? Read Become A Hero & Save Your Charity Money With Discounted Credit Card Processing For Nonprofits or any of our other resources and tools for nonprofits.

Want to get started with Square for nonprofits and open an account? Check out our step-by-step tutorial on how to set up a Square account.

Have any questions? We’d love to hear from you.

Square For Nonprofits FAQ