PayPal is a popular choice for many nonprofits to accept donations, but it may not always be the best fit for every organization. As your nonprofit grows and your fundraising needs evolve, exploring PayPal alternatives can open up new opportunities.
In this article, we introduce several PayPal alternatives for nonprofits. These alternatives offer features to help you streamline your fundraising efforts, improve donor engagement, and maximize your impact.
Why Your Nonprofit Should Look Into PayPal Alternatives
While PayPal is a well-known payment processor, it has several drawbacks regarding nonprofit fundraising. Nonprofits mainly want to maximize their fundraising efforts and ensure each penny goes straight to the cause. However, NPOs may want to check out PayPal alternatives when the payment processor comes with extra charges.
For instance, PayPal nonprofit donation fees are 2.2% + $0.30 per transaction. It charges a higher standard processing fee (2.9% + $0.30 per transaction) for other profit organizations.
Here’s what it means for your nonprofit: when a donor gives $100 through PayPal, you would receive $97.50 after deducting the 2.2% fee ($2.20) and the fixed $0.30 transaction fee.
For every $100 donation, your organization loses $2.50 to PayPal's fees. Over time, these fees can add up and significantly impact a nonprofit's fundraising efforts, diverting valuable resources away from its mission. Nonprofits should consider using a completely free donation platform to maximize the impact of every contribution they receive.
Disadvantages nonprofits may face with PayPal
- Customer support is automated and not tailored to the specific needs of nonprofit organizations.
- Tax receipts are not automatically generated, requiring additional clerical work and manual effort from the nonprofit staff.
- Donor management features are limited, with access to only basic transaction history and no advanced tools for donor engagement.
- Customization options for donation forms are minimal, restricting the ability to showcase brand assets and set custom donation amounts.
- Fundraising features are basic, allowing only simple online donations without support for ticket sales, raffles, or peer-to-peer fundraising campaigns.
→ Read our complete guide: What are PayPal donation fees and how to avoid them
Best PayPal Alternatives for Nonprofits
- Zeffy: Best and Only 100% Free Donation Processing Platform
- Square: All-in-One Contactless Payment Solution
- Stripe: Best Payment Processing Tool with Fraud Protection
- Google Pay: Best for Simple and Smooth Donation Process
- Venmo: Best for Social Sharing
- Apple Pay: Best for Apple Device Donors for Quick and Secure Payments
- Cash App: Best for Quick Transactions and Peer to Peer Payments
Top PayPal Competitors Nonprofits Should Consider for Donations
Cheaper Alternatives to PayPal for the Best Payment Processor Experience
1. Zeffy: Best and Only 100% Free Donation Processing Platform
- G2 Rating: 4.9
- Capterra Ratings: 4.8
Zeffy is a free, user-friendly, intuitive platform that nonprofits can use to process online donations effortlessly.
Unlike other platforms that charge payment processing fees, which can be challenging for organizations trying to maximize the impact of donations, Zeffy operates on a completely free model. It provides a secure method to collect donations without incurring any transaction costs.
Prominent features of Zeffy
- From credit cards, checks, Apple Pay, and Google Pay – Zeffy accepts all payment types.
- Zeffy's tap-to-pay solution allows you to receive payments in person (no terminal or POS needed).
- Versatile fundraising platform offering event ticketing, raffles, an online store, and membership management
- Nonprofits can create customizable donation forms by adding a logo, colors, and a custom banner.
- Create your own peer-to-peer fundraising campaigns.
- Donor management tools to track and cultivate donor relationships.
Pricing
100% free, with no hidden fees for the transaction or platform.
Customer Review
“EVERYTHING is fantastic from the immediate setup time to the ease of use to their phenomenal customer service…the “savings” are way more than just not losing money to credit card companies. It saves TIME and is so elegant and easy to use.” — Nicolas D.
2. Square: Best for Recording Donor Information
- G2 Rating: 4.6
- Capterra Ratings: 4.6
Square, founded by Jack Dorsey, one of the X (formerly Twitter) co-founders, is a financial services platform that caters to small businesses, including nonprofits. While Square is a popular payment processing solution for nonprofit organizations, having collected over 10 million donations, it's important to note that Square does not offer any discounts specifically for nonprofits. The platform accepts various payment methods, including cash, checks, ACH bank transfers, credit cards, debit cards, and swipe or chip cards.
Pricing
- The physical transaction processing fee is 2.6% plus $0.10.
- In-app Square transactions have a fee of 3.5% plus $0.15.
- Donation transactions have a processing rate of 2.9% plus $0.30.
→ Zeffy VS Square - Read the full comparison!
Customer Review
“My org loves using Square Payments because as a nonprofit organization, we make a lot of our funding through fundraising events. Having a mobile option to accept payments on the spot is absolutely massive for us to get the funding for our scholarship program and beyond.” — Sarah B.
→ Read our complete guide: Using Square for nonprofits donation
3. Stripe: Best Payment Processing Tool with Fraud Protection
- G2 Rating: 4.3
- Capterra Ratings: 4.6
Stripe is a user-friendly online payment processing platform that offers credit cards, debit cards, and ACH processing. It provides real-time reporting and meaningful insights into the results of your fundraising efforts. NPOs can track donor and transaction data to prevent scams. It offers an option to separate low-risk and high-risk transactions to detect fraud.
Pricing
Registered nonprofits processing at least 80% of donation payments on Stripe get reduced pricing of 2.2% + $0.30 per transaction as opposed to 2.9% + 30¢ per transaction for businesses.
→ Zeffy VS Stripe - Read the full comparison!
Customer Review
“We like the service and the ease of using Stripe. It's simple for us to create an invoice and email it to our customers. We have liked the option of when we receive a payment deposited into our account right away. Their customer service has always been helpful and answered our questions.” — Jeffrey.
Zeffy uses Stripe to process nonprofit donations securely while covering all transaction fees for your organization. Sign up on Zeffy to process Stripe donations for free!
4. Google Pay: Ideal for Simple Donation Process
- G2 Rating: 4.6
- Capterra Ratings: 4.6
Google Pay is a well-known payment gateway for any merchant account. It allows easy transfer of money and payments for small businesses and nonprofit organizations. NPOs can integrate a donate button on the website and create a one-click payment process.
Pricing
Google Pay is a free-to-use alternative to PayPal for nonprofits, If you reside outside the US, your bank or credit card issuer may charge you currency conversion / foreign currency transaction fees and taxes.
Customer Review
“Keeping track of contracts and budgets is not easy for anyone, especially for any nonprofit organization. Google Pay (formerly known as Google Wallet) really helps to streamline online payments for your financial operations department. It's easy enough to use the platform that team members can be cross-trained on the system fairly quickly.” — Sara Yaseen
Nonprofits on Zeffy's platform can effortlessly accept donations via Google Pay across all their online donation forms. Zeffy automatically integrates Google Pay, ensuring a seamless giving experience for donors. Zeffy takes care of all transaction costs, allowing organizations to receive the full donated amount without any deductions.
5. Venmo: Ideal for Social Sharing
- G2 Rating: 4.5
- Capterra Ratings: 4.7
Another best PayPal alternative is Venmo for nonprofits to send and receive payments.
Venmo, an online platform for transferring money, was acquired by PayPal in 2013, enhancing its functionality for nonprofits and donors. It enables nonprofits to create branded profiles showcasing their mission and keywords while allowing donors to easily contribute to organizations aligning with their interests through a single click. By streamlining the donation process, Venmo provides an effortless and beneficial way for nonprofits to receive support from their community.
Pricing
For every $1 or more donation:
- Venmo charges a standard fee of 1.9% + $0.10 for each donation.
- Tap to Pay feature costs 2.29% + $0.09 for each donation received
- Charges 1.5% fee for instantly accessing donations
Customer Review
"Venmo allows us to better engage with our members by allowing them to purchase swag, renew their membership, and donate quickly and easily. I have yet to run into a significant issue because the support staff has been wonderful.” — Andrew A.
→ Zeffy VS Venmo - Read the full comparison!
6. Apple Pay: Best for Apple Device Donors for Quick and Secure Payments
- G2 Rating: 4.7
- Capterra Ratings: 4.8
Apple Pay allows users to make payments securely and conveniently using iOS devices. They can add credit or debit cards to Apple Wallet for contactless donations.
The donors’ information is linked to their phones or computers, so they do not need to fill in details. The Apple payment gateway will fetch their contact and payment details each time they donate.
Pricing
- Apple does not charge fees or commissions on Apple Pay transactions.
→ Sign up on Zeffy to accept ApplePay payments across all online donation forms.
7. Cash App: Best for Quick Transactions and Flexible Donation Options
- G2 Rating: 4.3
- Capterra Ratings: 4.3
Cash App is a good PayPal alternative that enables supporters to make quick and safe payments. It helps NPOs accept, process, and record donations efficiently and accurately.
Developed in 2013, Cash App is a peer-to-peer platform to collect donations. It does not charge extra fees for debit cards, bank accounts, and ACH transactions.
Pricing
- 3% per transaction made using credit card payments
- 0.5% -1.75% fee for instant deposits
- Standard deposits are free
- Flat payment processing rates - No hidden fee
Customer Review
“I would like to list more than one debit card and checking account so I don't have to switch back and forth so often, it's very difficult to switch over sometimes especially if I am in a hurry.” — Verified Reviewer
→ Zeffy VS CashApp - Read the full comparison!
What to Consider When Choosing a PayPal Alternative for Donations?
When selecting a payment processor for your nonprofit, consider your organization's specific needs rather than opting for the cheapest or most feature-rich option. Choose a solution that aligns with your nonprofit's unique requirements. You may have to look for additional features specific to the needs of a nonprofit - donor management - for instance.
A good payment processor should support your nonprofit by offering services without levying a fee, as this allows more of the donated funds to benefit your cause directly. Here are some features to consider that will help you pick the best online payment processing solution:
1. Simple System to Process Donations
Choose a platform with a user-friendly interface that makes it easy for donors to give. The process should be straightforward and quick, with minimal steps to complete a contribution. A simple system helps reduce donor drop-offs and increase successful donations. Look for a platform that streamlines the giving process, making it hassle-free for your supporters and ultimately boosting your fundraising efforts.
2. Mobile Responsiveness
Many donors prefer to give on-the-go using their mobile devices. A mobile-friendly donation page ensures that your supporters can easily contribute, regardless of the device they're using. Opt for a platform that offers a seamless mobile giving experience, with a clean layout and easy-to-tap buttons, to maximize donations from mobile users.
3. Free Donations
Zeffy allows your nonprofit to collect online and in-person donations for free. Our innovative model maximizes your nonprofit's impact by allowing you to receive 100% of every pledged donation.
4. Donor Management
Streamlined donor management is essential for nonprofits. Choose a payment processing platform that offers tools to capture donor data, track giving history, and generate reports. This will help you understand your donors better, personalize your outreach, and cultivate strong relationships that lead to long-term support.
5. Branded Experiences
Your donation page should look and feel like an extension of your nonprofit's brand. Pick a platform that lets you customize your pages with your logo, colors, and messaging. This builds trust with donors and creates a smoother giving experience that keeps supporters coming back.
6. On-Demand Support
When you're processing donations, any hiccups or delays can be costly. Choose a payment gateway with a dedicated support team that understands the unique needs of nonprofits. Having access to knowledgeable, responsive support ensures that your donation process runs smoothly and you can focus on your mission.
Which PayPal Alternative Should You Use?
PayPal is one of the well-known payment processors out there, but nonprofits have different needs. NPOs require features like peer-to-peer fundraising, donor management, and recurring donations. More importantly, they need to ensure all funds raised go entirely towards their cause without transaction fee deductions.
This is where Zeffy comes in as the best alternative for nonprofits. Turning to Zeffy means your cause gets 100% of the donation. Experience fully automated payment processing with Zeffy!
FAQs
Who is PayPal's biggest competitor?
Stripe for nonprofits is one of PayPal's biggest competitors. It is a payment processor that offers features like recurring and in-person payments.
This platform is ideal for organizations searching for a high level of technical customization. However, Stripe's pricing structure may not be ideal for everyone.
Square and Bloomerang are the other two contenders of PayPal.
Is Venmo an alternative to PayPal?
Venmo, a mobile payment service owned by PayPal since 2013, makes it easy for users to send and receive money through linked bank accounts. With Venmo, people can transfer funds quickly by just scanning a barcode on their phone.
Nonprofits can use Venmo to accept donations by setting up charity profiles. This way, donors can give money straight to the organization's account using their mobile phones, making the process simpler and more convenient for supporters.
Compare Zeffy (100% free) with these payment processors for donations.
Does PayPal offer recurring donations to charitable organizations?
Yes, donors have the option to set up monthly or other recurring payments. Charitable organizations can forecast and budget based on regular donation sources. Donors also benefit from the convenience of automating their contributions, ensuring consistent support for the causes they care about without having to remember to make individual donations each time.
How do nonprofit organizations get discounted transaction fees with PayPal?
Here are a few steps NPOs can follow to secure discounted fees on PayPal:
- Verify as a registered nonprofit with the IRS (or equivalent entity in other countries).
- Once you have the right document, apply for the PayPal application process and provide the necessary details. Submit proof of your 501(c)(3) status or equivalent in your country.
- After approval from PayPal, you can receive discounted transaction fees for its payment processing services.
Is Venmo owned by PayPal?
Yes, PayPal has owned Venmo (established in 2008) since 2013. Venmo is a peer-to-peer payment app that allows users to easily send and receive money from friends and family. It also has a social feed that shows completed transactions, adding a unique social aspect to the platform.
Is there a free alternative to PayPal?
Yes, one of the best 100% free alternatives to PayPal is Zeffy for nonprofits. Zeffy is an online donation platform offering a user-friendly experience for NPOs and donors.
Nonprofits can use this solution to accept donations securely without any setup or processing fees. It is the best option for small nonprofits looking to save on transaction costs.
Zeffy offers incredible customization options for creating branded donation pages.
Do nonprofit organizations pay credit card processing fees?
Yes, some platforms do charge credit card processing fees for donations. However, this is not true for every donation processor.
Many payment processing tools that are not specifically designed for nonprofits, such as PayPal, the leading provider, offer discount fee options.
