You work hard to raise funds as a nonprofit, and the last thing you want is for hidden payment processing fees to eat into donations meant for your cause.
Yet, many nonprofits unknowingly lose a significant percentage of their online donations to high transaction fees, platform charges, and other unexpected costs.
Here’s the truth: not all payment processors are nonprofit-friendly.
While some platforms make online donations easy, they often come with high transaction fees, assessment fees, and hidden costs that quickly add up.
Understanding these fees—and learning how to minimize them—can help your organization keep more of what it raises and ensure that donor contributions go where they’re needed most.
In this guide, we’ll break down:
✔ The real cost of online payment processing for nonprofits
✔ How to choose a low-cost, secure, and donor-friendly payment processor
✔ Actionable strategies to reduce processing fees and maximize donations
If you want to make sure your nonprofit isn't overpaying for credit card processing, donation platforms, or online giving tools, keep reading.
You’ll walk away with practical steps to cut costs while keeping transactions secure and seamless for your donors.
7 Strategies to Minimize Transaction Fees for Nonprofit Payment Processing
Reducing payment processing fees is one of the smartest financial decisions a nonprofit can make.
Every credit card transaction fee, platform charge, or assessment fee adds up, ultimately taking money away from the causes that matter most.
Luckily, there are several ways to lower transaction costs, optimize online donation processing, and ensure that more of your fundraising dollars go where they belong.
1. Choose a Payment Processor with Nonprofit Discounts
Not all payment processors charge the same fees. Some providers offer lower transaction fees for nonprofits, while others impose hidden charges that make fundraising more expensive.
Best nonprofit-friendly payment processors:
Bloomerang for Nonprofits (2.2% + $0.30 per transaction for U.S. donations)
Fidelity for Nonprofits (2.6% per transaction)
Stripe for Nonprofits (2.2% + $0.30 per transaction)
Donorbox (1.5% platform fee + processing fees)
Avoid processors that charge:
High platform fees
Monthly minimums that force you to pay even when you don’t process donations.
Setup fees just to get started.
Tip: If your nonprofit processes a high volume of donations, negotiate custom rates with providers to get lower processing fees.
2. Encourage Donors to Cover Processing Fees
One of the simplest ways to reduce costs is to give donors the option to cover transaction fees at checkout.
Many fundraising platforms allow this, and most donors are willing to pay the extra 2-3% per donation to ensure their full contribution goes to your cause.
How to implement this:
Enable the “cover the fees” option on donation forms.
Use fundraising platforms like Donorbox and GiveWP, which have built-in donor-covered fee options.
Add a message explaining why covering the fee helps your nonprofit.
3. Use ACH and Bank Transfers Instead of Credit Cards
Credit card processing fees are among the highest costs for nonprofits.
A simple switch to ACH (Automated Clearing House) transfers or eChecks can significantly reduce processing fees, often to 0.5% – 1% per transaction instead of the standard 2% or more for credit cards.
Best low-cost payment options for nonprofits:
ACH donations (lower fees than credit cards).
Bank transfers (direct and secure transactions).
Zelle for nonprofits (no fees for bank-to-bank transfers).
Tip: Some donors prefer credit cards for convenience. Offer both options and highlight ACH as the “low-fee” donation method.
4. Negotiate Lower Rates with Payment Providers
Many nonprofits don’t realize that transaction fees aren’t always set in stone. If you process a high volume of donations, you have leverage to negotiate lower processing fees.
How to negotiate better rates:
Compare multiple payment processors to get the best deal.
Ask for lower markup fees based on your transaction volume.
Highlight your nonprofit status—some providers have unpublished discounts.
5. Avoid High-Fee Crowdfunding and Donation Platforms
Crowdfunding sites like GoFundMe, Kickstarter, and Indiegogo are popular, but they take a big cut of your donations (sometimes 5-8% in fees!).
Instead, choose a nonprofit-specific donation platform with lower rates.
6. Regularly Audit Your Payment Processing Statements
Hidden fees can add up without you even realizing it. Many nonprofits unknowingly pay extra assessment fees, PCI compliance charges, and statement fees that aren’t necessary.
How to audit your fees:
Review monthly statements from your payment processor.
Look for hidden charges that weren’t disclosed upfront.
Compare competitors to see if you can get a better deal elsewhere.
7. Use Recurring Donations to Reduce Per-Transaction Fees
Encouraging monthly giving programs is a great way to minimize processing fees because you reduce the number of individual transactions (and therefore, fewer per-transaction fees).
Best ways to increase recurring donations:
Offer automated monthly giving options on your donation page.
Provide incentives for monthly donors (e.g., special reports, updates).
Use text-to-give services for easy recurring giving.
Final Thoughts
High credit card processing fees and hidden donation platform charges can quietly drain your nonprofit’s resources.
But by choosing a nonprofit-friendly payment processor, offering ACH donations, negotiating lower rates, and encouraging donors to cover fees, you can significantly reduce costs and maximize donor contributions.
Schedule a Free Consultation
Payment processing for nonprofits can feel overwhelming, but you don’t have to do it alone.
The right payment strategy can help you cut unnecessary fees, boost donor trust, and ensure that more of each donation actually supports your mission.
I specialize in helping nonprofits find the best payment solutions that reduce
costs, enhance security, and improve the donor experience.
Let’s analyze your current payment setup and explore ways to save money on transaction fees—without sacrificing convenience or security.
תגובות