What is the Best Way to Collect Donations Online?
It is no secret that effective fundraising is a core driver of success for many nonprofit organizations. Automating an efficient and secure donation process can enable long-term viability and create a more predictable income stream. Luckily, there is no shortage of fundraising software options to facilitate that process.
To help get you started, we have compiled some tips for taking the complexity out of deciding which online donation tools work best for your organization.
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Why Collect Donations Online
Charities employing an online donation collection process are able to meet their supporters where they are. In an increasingly connected world, the convenience of managing donations online is continuing to gain traction. In fact, 67% of worldwide nonprofits accept online donations. Let’s break down the benefits for your organization.
Anthony definitely thinks his nonprofit should be collecting online donations!
One of the main benefits of leveraging online donation tools is the increased reach you are able to achieve. Diminished geographic boundaries, and the ability to tap into social media platforms, changes the game. Crowdfunding is one of the rising online donation trends and can be a lucrative addition to your fundraising tools and overall strategy.
Pro Tip: If you are considering a crowdfunding platform, determine whether a reward-based component may work for incentivizing your organization’s supporters. 20% of donors are more likely to donate money if they get a gift in return. However, if you go this route, do your due diligence to ensure that your target audience falls within this category. According to Giving USA, the majority do not need a gift to donate and 6% of that group actually cite the environmental impact of gifts as a reason they would not donate.
Another key consideration for collecting donations online is the impact on existing staff. Many charities operate with small teams, and oftentimes volunteers, so automating fundraisers and other campaigns aimed at generating donations frees up personnel to focus on other tasks. Additionally, automatically generating confirmations, thank you notes, and receipts for instant distribution is another time-saver.
Donation pages that live on a website are available around the clock and are not bound by office hours and staff availability. It is helpful in reducing administrative costs and processing delays, as well as increasing ease of reporting and tracking. For many platforms, it is also possible to have processing and other fees covered in the donation amount to maximize the funds your organization can utilize.
Through online donation tools, supporters are able to establish a regular cadence of monetary gifts with no additional effort. A streamlined process where donors can determine the amount and frequency of contributions is user friendly, efficient, and a way to garner more donations over time. This results in better cash flow predictions and potential income stability.
The regular touchpoints allow you to provide updates on your organization’s progress for certain campaigns or provide general mission-driven messaging. This can go a long way toward building a relationship with donors and solidifying trust. Having a strong online presence allows you to continue telling your story. Creating a compelling narrative will help drive potential donors to your site and entice them to click through to your donation portal.
Finally, another reason to leverage online donations tools is the familiarity of the general public with Ecommerce and online transactions. The past few years have gone a long way in increasing comfort with making purchases or donations via the internet. In 2020, over 2 billion people made an online purchase! The expansion of digital assets aimed at managing that process shows the practice is not going anywhere anytime soon. It should be seen as a smart addition to any overarching fundraising strategy.
How to Collect Donations Online in Six Steps
Now that we have (hopefully) convinced you of why you want to collect donations online, let’s dig into how to do it most effectively!
1. Create a Simple Donation Form
Creating an easy-to-find, succinct donation form is an important step for enabling supporters to donate to your organization. A prominent call-to-action donate button will allow online visitors to navigate to your form easily. Be sure that your form is embedded on your website, not linked to another external site. This maintains the connection with your organization and contributes to trustworthiness.
Additionally, having an online form that lives in your website affords the opportunity to have messaging that reinforces your mission. You can carry forward your branding elements and create a more holistic experience for those engaging with your organization. The ability to track progress against campaign goals also exists so donors can see where you stand how their donation will impact your efforts.
In the development of the form, be mindful of the fields required. You do not want to create a complicated experience that will deter donors, but you do want to be collecting enough meaningful data for marketing purposes. Think about what makes the most sense for what you are trying to accomplish and how you use donor data. The following is not an exhaustive list, but some of the most common fields include:
First and Last Name
Amount to Donate
Preferred Method of Payment
Indicate Recurring Payment and Frequency
How Did You Hear About Us?
One final must-have for your online donation form is the ability for it to be mobile-responsive. There has been an increase of more than 50% in the number of transactions people are conducting via mobile device. When someone is inspired to give, you want them to be able to seamlessly find your page and submit a donation. A form that does not render properly creates a poor user experience and may cause you to lose out on meaningful donations.
Emily is nearly ready to start collecting online donations!
2. Choose Your Payment Processor
A payment processor is effectively the middleman between your contributor’s payment and your organization. This entity is responsible for managing the transaction process for the donation. Having a seamless payment processing set-up creates a positive experience for both donors and your staff or volunteers. There are various tools on the market and a brief overview of a small sampling is contained below. When deciding on the processing method that works best for you, assess the pros and cons that would be associated with your most common use cases to help you achieve your financial goals.
A few popular payment processors are as follows:
Stripe is an online payment processor for businesses engaged in ecommerce. They provide a suite of services to support startups, nonprofits, and Fortune 500 companies alike. Their powerful and user-friendly APIs ensure simple and secure transferring of money. Offering pay-as-you-go pricing, Stripe has a discounted rate for nonprofits of 2.2% processing fee + $.30 per transaction fee for accepting donations. Custom packages are also available.
Likely one of the best-known avenues for nonprofit fundraising, PayPal has established longevity in the industry. They offer a discount for confirmed 501(c)3 charities with no monthly fees. The discounted rate for online transactions is 2.2% processing fee + $.30 per transaction. An additional fee structure applies for those who wish to also accept in-person payments or donations less than $10.
Adyen is an omnichannel payment processor that covers different categories of transactions. It is steadily gaining traction and allows for accepting donations across multiple currencies. Typically targeting larger organizations, the fee structures vary but a rate between 1.7% and 3.5% per transaction can be expected.
Specifically designed to integrate with leading software platforms, WePay syncs with your existing CRM to facilitate a seamless donation process. It also provides transaction-level reporting to help with data collection. The standard cost is in 2.9% processing fee + $.30 per transaction.
Payment processing rates vary for the type of transaction you wish to conduct. Credit and debit card fees are different from in-person donation collections, which are in turn different from ACH transfers. Whichever processor you select, be sure to estimate your volume of payments to accurately assess how the fee structures may impact your bottom line.
Pro Tip: When choosing your payment processor, ensure you factor in customer support. A partner known for their quick and upstanding support is critical when dealing with sensitive issues like payments, credit card details, and other personal information.
3. Offer Multiple Modes of Payment
Not all donors prefer to give the same way, and not all online donation tools offer every possible option. When creating a donation page, be sure to make it clear how donors can contribute. Although sending physical checks is decreasing in popularity, it is still a viable (and common) way for individuals to contribute. Continuing to accept cash and check donations is a great way to ensure you cater to all parts of your target market.
Credit and debit card payments are among the most popular for online transactions and are widely accepted across payment processors. Having a card on file allows for easily creating a recurring payment without additional effort on the donor’s part.
Newer to the mix are Apple Pay and Google Pay. Donors can submit their gifts remotely on a desktop computer, tablet, or smart phone without needing to manually type in credit card details. Donations need to be authorized through the connected Apple Pay or Google Pay account before being processed. In general, no additional fees are charged per transaction, just the prevailing fees associated with the payment processor.
Another payment option that exists, but it is not widely adopted, is ACH transfer. An ACH transfer involves linking two bank accounts, which would be the donor and the charity. A great example of how this works is through online bill pay. If you schedule a payment to your credit card company from your bank account, that payment will be made through ACH. There are typically lower transaction fees associated with ACH transfers; however, one of the cons with this payment option is the general hesitancy among donors to supply direct bank account information.
Given the nuances associated with each payment option, it is important to consider offering as many avenues as possible for your donors. The more robust your online donation tools are, the more donations you will be able to capture. Analyzing donor history and past payment option selections can go a long way to determining how to build out your donation strategy and subsequent campaign targeting.
4. Promote Ways to Give
Similar to offering various direct payment options, creating multiple pathways for people to find you will help generate more donations and expand your base of support. Additionally, consider donor history and how certain supporters interact with your organization.
Establishing an online donation program provides the opportunity to cross-promote with other fundraisers you may have planned. Even an in-person event can have a drive-to-site function to land potential donors on your website. As long as the donate button is prominently displayed and your donation form is user-friendly, you can use your online donation tools to supplement existing activities.
Using your web presence to promote ways to give to your organization is highly beneficial. Some donors will be motivated by certain causes or specific campaigns, while others may be seeking information about in-person opportunities.
Target different audience segments based on prior giving (based on donation ranges) by tailoring fundraising campaigns. Establishing tiers within your donor records can help you streamline communications. Even beyond web-based or email appeals, any scripting for calls or language for written letters should reflect the history of a particular donor with your organization. The more personalized you can be, the stronger the relationship is bound to become.
5. Enable Recurring Donations
In order to maximize the benefits of deploying online donation tools, be sure to enable the functionality for recurring donations. Of course, any donation is valued, but being able to capitalize on your supporters’ generosity to generate a more consistent and predictable stream of income is fantastic! Allowing the option to select direct debit or credit card payments to be scheduled at the donor’s preferred interval goes a long way for strengthening the relationship with your organization.
Sam is enabling recurring donation functionality right now!
Many donation forms offer the opportunity to select monthly, quarterly, or annual gifts. Donors that commit to recurring donations are clearly supportive of your charities’ mission. Another perk of some automated forms is the option to have the donor cover processing fees and other fees to help ensure your nonprofit can get the most out of each gift.
Having automated confirmations and thank you emails from the system helps reinforce the relationship. It is possible to provide updates on the impact recent donations have made, what they have enabled your organization to accomplish, and provide status updates or progress toward achieving a milestone.
Pro Tip: Recurring donors give approximately 42% more per year than one-time donors.
6. Use a Dedicated Donation Software
There are many donation collection tools with varying levels of complexity that can help you design and execute a fundraising campaign. A few options are as follows:
You are visiting Springly’s blog for a reason! We are an all-in-one management software for nonprofits. Featuring a CRM, event management tools, and donation management capabilities, Springly aims to increase efficiency through comprehensive automation. The cost structure is versatile and tiered based on number of contacts. There is a payment processing fee of 2.9% + $.30 per transaction fee, but Springly does not collect any additional fees. As an added bonus, donations are automatically recorded in the accounting feature and tax receipts are automated, saving precious time on manual tasks.
Donorbox is also specially designed for nonprofit fundraising. It is an all-in-one donation management software with the ability to customize donation forms. Donorbox carries a 1.5% platform fee, and payment processing through Stripe or PayPal incurs a 2.9% provider fee + $.30 per transaction fee, as noted above.
Another all-in-one solution, CharityEngine is a CRM with 360-degree donor management built to leverage data to drive growth. Targeting nonprofits, CharityEngine focuses on automation and fully native apps, and includes PCI-certified payment processing. Due to the customizable nature of CharityEngine’s platform, pricing structures vary and are mainly based on the number of users. Packages begin at $350 per month.
Kindful is a nonprofit CRM built to integrate with the tools currently used within your organization. It helps organize your data to improve communications and fundraising campaigns. Like other similar platforms, pricing is predicated on the number of contacts and billed annually. There are no additional transaction fees.
Qgiv bills itself as "Made for Fundraisers, Designed for Donors." It includes features like event registration, text-to-donate functionality, auction tools, and data reporting. Their platform integrates with marketing support services such as Mailchimp and Constant Contact, as well as database integrations. Qgiv’s pricing plans vary based upon package components selected.
Another platform designed to simplify the donation process to help nonprofits grow their impact through online fundraising is Donately. A key differentiator for Donately is the text-to-donate feature. Consistent with other models, pricing is tiered and based upon annual funds raised. The platform fees also vary by tier.
DonateKindly is free customizable online donation form software that embeds in your website. The simplest of the aforementioned options, it is easy to embed and carries no setup fees, monthly fees, or transaction fees. DonateKindly integrates with payment processors like WePay, which can reduce rates to as low as 2.1%.
With the wide range of options available in the market, the right mix for your organization is out there. The more robust, all-in-one solutions enable a higher level of automation, but even the simpler solutions can provide incremental improvement. Streamlining a donations process goes a long way to creating leaner, and more efficient operations.
Whichever tool you select, do not forget to solicit feedback along the way to improve the user experience. You want to keep strengthening the relationship you have with your donors so facilitating an easy and efficient transaction process is a great start.
Because the success of many nonprofits is so closely linked to effective fundraising, making that process as easy as possible for contributors is key. Accepting a wide variety of payments and using donation software will not only reduce the manual burden on your team, but also provide a simple and secure experience for donors that ultimately offers a more predictable income stream. Sharing these best practices will help guide you on your way to determining the most appropriate solution for your organization. Keep in mind that enabling various pathways for donors to find and efficiently transact with you is the best way to collect donations online. A modest investment can go a long way to ensuring your charities’ long-term success.
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💡 What is the best way to get donations?
The best way to get donations online is by enabling multiple pathways for potential donors to find you and efficiently transact with your site. Offering multiple payment options, including the ability to enroll in recurring payments, through an automated system helps create a more seamless experience. Find out more.
🔑How can nonprofits collect money online?
There are multiple options for collecting money online. Nonprofits may choose an all-in-one platform with built-in donation management and payment processing tools, or simply leverage a payment processor to integrate with existing platforms and tools. Find out more.
📝 What online payment system is best for nonprofits?
The best online payment system varies depending upon the needs of the nonprofit and goals they are trying to accomplish. There are different capabilities and fee structures associated with the various systems so they should be assessed on a case-by-case basis. Find out more.