How to save on donation processing fees

Going hand in hand with our prior post about the importance of mobile-friendly websites, this week we focus on a simple way to maximize online fundraising dollars.  Many of our donors are unaware of the cost associated with raising funds online- namely online donation processing fees. Percentages charged vary from 2.4% of the donation through Commitchange (although they charge a monthly fee for use) to 8% of the donation on Classy. Here are numbers courtesy of a CommitChange post to show how much is lost to fees annually.

This is the fee cost for an organization raising $100,000 online this year:

Razoo: $6,900            Crowdrise: $6,900      Classy: $4,200 

CommitChange: $2,400                          FirstGiving: $7,500

Statistically speaking, giving donors the option to cover these processing fees is a no-brainer.  Whether it is a delivery cost for pizza, processing fees for concert tickets, or shipping items that aren’t eligible for Amazon Prime, donors are accustomed to additional service fees incurred while making online purchases. The bottom line is that donors want to help your organization and giving them the option to pay an additional service charge (that most are already used to) serves that purpose.

We have offered this fee-cover option for our clients, thanks to our friends at Blue Sky Collaborative. Donors can choose to cover the fee of our payment platform, Stripe.  When doing this the full donation, including transaction fees, is tax-deductible (so if you give $100 plus 3% for fees, the entire $103 is tax-deductible). See an example of this functionality on our client Compassionate Care ALS’ website here.

Our results have been astounding. Since we implemented this for one of our clients more than 42% of donors have chosen to cover the fees. On another team-based fundraising site we oversee, over 90% of our clients’ donors have covered their fees. Interestingly, on this site we made the fee coverage an opt-out rather than an opt-in, which we feel contributes largely to such a high coverage rate.  Nationally, according to FirstGiving, “our nonprofits see that 38% of donors decide to pay processing fees.”

At DSA we charge a one-time fee to build custom-designed giving pages and incorporate an optional fee coverage for donors.  Moving to this model with a one time up front cost allows your organization to recoup a significant percentage of processing fees which can save your organization thousands of dollars.
Interested in learning more about how to reduce processing fees? Email us at teddy@dsaboston.com!

Going hand in hand with our prior post about the importance of mobile-friendly websites, this week we focus on a simple way to maximize online fundraising dollars.  Many of our donors are unaware of the cost associated with raising funds online- namely online donation processing fees. Percentages charged vary from 2.4% of the donation through Commitchange (although they charge a monthly fee for use) to 8% of the donation on Classy. Here are numbers courtesy of a CommitChange post to show how much is lost to fees annually.

This is the fee cost for an organization raising $100,000 online this year:

Razoo: $6,900            Crowdrise: $6,900      Classy: $4,200 

CommitChange: $2,400                          FirstGiving: $7,500

Statistically speaking, giving donors the option to cover these processing fees is a no-brainer.  Whether it is a delivery cost for pizza, processing fees for concert tickets, or shipping items that aren’t eligible for Amazon Prime, donors are accustomed to additional service fees incurred while making online purchases. The bottom line is that donors want to help your organization and giving them the option to pay an additional service charge (that most are already used to) serves that purpose.

We have offered this fee-cover option for our clients, thanks to our friends at Blue Sky Collaborative. Donors can choose to cover the fee of our payment platform, Stripe.  When doing this the full donation, including transaction fees, is tax-deductible (so if you give $100 plus 3% for fees, the entire $103 is tax-deductible). See an example of this functionality on our client Compassionate Care ALS’ website here.

Our results have been astounding. Since we implemented this for one of our clients more than 42% of donors have chosen to cover the fees. On another team-based fundraising site we oversee, over 90% of our clients’ donors have covered their fees. Interestingly, on this site we made the fee coverage an opt-out rather than an opt-in, which we feel contributes largely to such a high coverage rate.  Nationally, according to FirstGiving, “our nonprofits see that 38% of donors decide to pay processing fees.”

At DSA we charge a one-time fee to build custom-designed giving pages and incorporate an optional fee coverage for donors.  Moving to this model with a one time up front cost allows your organization to recoup a significant percentage of processing fees which can save your organization thousands of dollars.
Interested in learning more about how to reduce processing fees? Email us at teddy@dsaboston.com!

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