There are many companies eager to help you with the task of online donations, from standard credit card processors to those specializing in nonprofits.  So how do you decide which provider is right for you? Here are seven factors for you to consider when choosing an online donation service provider:

1. Features

When evaluating service providers first decide on your goals and needs. For example, do you simply need a way to accept one time donations, or are there other options that you require such as:

  • Designated fund giving
  • Monthly giving (automated)
  • Pledging (with a time limit, not open ended recurring)
  • Memberships
  • Event registration
  • Sponsorship payment
  • Memorials and honorariums
  • Individual fundraising pages (for programs such as walk-a-thons)
  • Team based fundraisers

Are these modules that you’ll need right away or are you anticipating adding these options in the future?  Depending on your short and long range plans you may start out with a very basic provider, or go ahead and choose a full featured system in preparation for future development.

2. Donation Volume

Next consider your anticipated volume of transactions, both the number of individual transactions and the total funds raised. If you are currently using another donations processor you’ll have some data to work with.  Otherwise, you’ll just have create some projections based on your goals.

Your anticipated online donations will influence the type of pricing model that will be best for your needs.  For example, if you are using a “micro-donations” strategy of $5-10 from thousands of donors, a pricing system that charges per transaction fees might be a bad idea.  On the other hand, if you anticipate a large total amount of donations, a flat fee rather than a percentage fee might be best.

3. Pricing

As mentioned above each provider has a different pricing structure.  Based on your own circumstances, such as the anticipated donation levels and the features you need, consider which pricing model is best for your group.

Some of the fees you may encounter include:

  1. Flat fee per month or year
  2. Credit card processing fees
  3. Percentage fee taken from each donation (in addition to credit card processing; sometimes these two are combined)
  4. Per transaction fees
  5. One time set up fee

Also note that some providers handle all the financial transactions for you, while others run transactions through a third party merchant account which you set up separately.  Sometimes as an alternative to a merchant account you can use PayPal instead.

4. Security

Security is always important, so verify that the provider has all of the correct online security features in place.  Personal information used for transaction should be encrypted and protected with SSL.

You may look for security seals and information such as Verisign, SSL, Better Business Bureau accredication and privacy policies. Testimonials and case studies from satisfied clients can also bolster your confidence in the security and trustworthiness of the company.

5. Ease of use

Determine if the provider has easy to use software modules based on your particular needs.  If the company offers an online demo and/or telephone led demo with a consultant, that will give you a hands on experience. That way you can test out the system for yourself to see how user friendly it is both for administrators and how it will work for your supporters.

6. Customer service

Does the company provide customer service by telephone and email?  Is it easy to find their contact information and mailing address? Call the customer support line before  signing up for the service to see what kind of experience you have.  You’ll have a reason to contact support at some point, so you want to make sure ahead of time that they will be there for you when needed.

7. Organizational commitment

Last but certainly not least, take a long hard look at how online giving figures into your organization’s overall donations strategy.  There’s a lot more to internet donations than just added a “donate now” button!  If you invest a lot of money upfront and yet have no specific strategy for driving online donations, you could lose money and be quite disappointed.

Create a strategic plan for your group to impliment online giving including short and long term marketing.  Then use this plan to decide which third party service best suits your needs.

Donation providers to consider:

PayPal is the absolute most basic form of accepting donations online.  It lets you accept donations made with credit cards, debit cards, and PayPal.  There’s no monthly, set-up, or cancellation fees and low transaction fees.  Supporters don’t even need a PayPal account to make their donations. Of course with this simple option there are no built in donor tracking systems, email follow-up or other resources.

Earlier this year I wrote a comparison of three online service providers: Network for Good, Firstgiving, and Click and Pledge.  They each provide different features and one may be a good fit depending on your online fundraising needs.

Step by Step Fundraising is now directly affiliated with two online service providers:

DoJiggy may have a funny name, but this company offers some serious online fundraising services.  In addition to online donations, there are other separate modules for online auctions, pledge based events like walk-a-thons and golf registrations.  Each module has a separate annual fee.

With Qgiv all the features are included in one annual fee: online donations, recurring or monthly giving, event registration, special campaigns and honorariums.  During the online demo with one of their consultants, I found that the system was very easy to use.

Looking for more options?  Here’s a big list of online donation service providers. Read, click and research until you find the one that’s right for you!

Posted on 18 November 2009

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