Finding the Best Credit Card Processing Program for Your Nonprofit

In our previous article, we outlined all the inputs a nonprofit leader would need to consider when choosing a credit card processing provider. But how does a nonprofit executive choose between the various companies that offer comparable merchant services? In this article, we are laying out the different credit card processing software options that are available to your nonprofit. Every nonprofit is unique, and every credit card processing software is unique. Let’s take a deeper look at which providers are the best fit for your organization.   

PayPal

If you are a nonprofit that is just starting out taking credit card donations PayPal is the most popular and convenient credit card processing system. Your nonprofit will want to set up a business account with PayPal so that you can directly wire your donations from your PayPal into your nonprofit’s checking account. PayPal offers services specifically for processing donations. Through the donation tab under the merchant services section, your nonprofit will be able to track your donations and directly insert a donation button into your website that directly links to PayPal. We would recommend PayPal for small and mid-sized nonprofits because of the convenience, simplicity, and security that comes with a well-known service such as PayPal.  

Fees: 2.2% + $0.30 per transaction with no monthly fees for nonprofits

Contract: No binding contract

Features: See PayPals One Sheet Here 

Square

Square is a very widely used credit card processing system. Square is a fantastic option for nonprofits who plan on taking credit card donations in person. When you sign up for Square, you receive a free magstripe reader that can easily be plugged into an iPhone or iPad and can read and process credit card payments. There are also more advanced in-person credit card processing systems you can upgrade to such as the Square chip reader and the square terminal which can accept all payment types and print receipts. In addition to in-person credit card processing options Square also offers Square Online. Square Online allows your nonprofit to set up credit card processing through your website. With Square Online, your nonprofit can accept credit card donations, sell and promote tickets to upcoming events, and collect emails of site visitors in order to improve your marketing. Square Space has no monthly fees and a 2.9% fee per transaction. Additionally, Square offers nonprofit discounts to nonprofits making $250,000 or more a year. We would recommend Square to nonprofits that plan on accepting credit card donations in person, and we would recommend Square Online to nonprofits who do not have an established website or are looking to better integrate their credit card processing into a seamless website. 

Fees: 2.6% + 10¢ per transaction for all major credit cards, 3.5% + 15¢ for manual transactions  

Contract: No Contract 

Features: See Square’s Nonprofit Features Here 

Dharma Merchant Services

Dharma is a great option for nonprofits that process over $10,000 per month. With Dharma’s credit card processing software, there is no annual fee and no monthly minimum. Additionally, Dharma is a great choice for nonprofit because it offers discounted pricing for eligible nonprofits. Dharma offers a variety of products and services, so if your nonprofit is looking to have a variety of different payment processing programs both online and in-person it is a great choice. These services include mobile processing, credit card terminals, payment gateways, and more. Dharma also has a program designed to specifically serve nonprofits. Dharma offers the discounted storefront rate of 0.15% + $0.07 and a discounted virtual rate of 0.20% + $0.10. Dharma also offers a way for their partnered nonprofits to create a donation page/ website with the online fundraising platform 4aGoodCause. 4aGoodCause allows nonprofits to track donations, reach out to donors, and set up recurring donations. Overall, we would recommend Dharma to nonprofits that take in a high volume of donations that are looking for an additional online fundraising platform.   

Fees: Storefront Rate 0.15% + $0.07, Virtual Rate of 0.20% + $0.10, $20 Monthly Fee 

Contract: No long term agreement, $25 account closure fee  

Features: See Dharma’s Nonprofit Solutions Here 

National Processing

National Processing is a great option for nonprofit due to its overall dedication to philanthropy. National Processing offers discounted rates to eligible nonprofits, but its most unique characteristic is that it also donates a portion of their rates to the nonprofit Operation Underground Railroad. Operation Underground Railroad is a nonprofit that is dedicated to providing aid to human trafficking and sex trafficking victims. Here at Charity Charge, we love this aspect of National Processing because with the Charity Charge Individual Credit Card we will donate 1% back of all of your purchases to the nonprofit of your choice. National Processing also offers an interchange-plus plus payment program. Interchange-plus payment programs provide more transparency in their charges due to the fact that they break down all of the charges that go into processing your payments in your statements. These include charges going to the issuing bank and credit card associations. Another benefit of National Processing is that there is no early termination fee. This way, if your nonprofit unfortunately need to cease taking credit card donations you will not be penalized. If you are interested in learning about the specific rates that apply to the nonprofit discount offered by National Processing, we would suggest contacting customer service as fees may vary. Overall, we recommend National Processing to nonprofits with a sizable amount of monthly donation and who are looking for additional convenient ways to give back.  

Fees: eCommerce rates $10 per month + interchange fee, reach out to see special nonprofit pricing here

Contract: No contract 

Features: See National Processing’s General Pricing and Features Here

Merchant Account Credit Card Services

If you are a larger nonprofit with an established relationship with a large bank a Merchant Account may be a good option for your organization. Merchant Accounts can be an excellent choice due to the fact that your bank is already familiar with the financial needs of your organization, unlike generic systems. There are some downsides to Merchant Accounts. The process of applying for the account can be very time consuming and requires a lot of paperwork. Additionally, there are fees that are involved in pursuing a Merchant Account that PayPal and other processing systems do not require. Although this may be off-putting if your nonprofit is larger and takes in a sizable amount of donations it is valuable to have your donations processed through a bank that is already familiar with your organization and can provide personalized customer service. If you’re interested in learning more about accepting credit card donations, read this article from Fundraiser Help. 

The pricing, contracts, and features for Merchant Account Credit Card Services all depend on the individual bank.

Overall, there are so many credit card processing options available to your nonprofit. In this article, we have laid out five great options, but this does not mean that other great options do not exist. Our advice for when you are searching for a credit card processing system is to inquire about discounts available to nonprofits. The majority of processing systems offer these discounts so we would encourage you to seek those out. We would also suggest that you look at monthly minimums. These are important because small and large nonprofits have different needs, and different cred card processing systems best serve different volumes of donations. We hope this article is helpful in your nonprofit’s search for the credit card processing system that will work best for you.  

 

Allison Miller
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