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PayPal donate button—is it worth it?

Discover PayPal donate button's pros and cons and three reasons why nonprofit organizations might need something more.

Rachel Mills
December 29, 2023
February 24, 2020
Nerd Mr Butter

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These are all reasons why over one million nonprofits choose to add a PayPal donate button to their websites and fundraising pages. After all, PayPal is one of the most recognizable and trusted payment processing options. 

Still, every platform has its pros and cons. We’re breaking down everything your nonprofit needs to know about the PayPal donate button—strengths, weaknesses, and other solutions your organization may want to consider. 

Is the PayPal donate button worth it?

PayPal is a well-recognized and trusted brand, making a PayPal donate button a viable option for many nonprofit organizations that want to accept donations online. 

However, the PayPal plugin is not optimized for nonprofits, meaning new and potential donors will miss out on a donor-centric experience that builds recognition and trust with YOUR nonprofit over time—not just PayPal's brand. 

How the PayPal donate button works

Nonprofits interested in adding a PayPal donate button to their website must first sign up for a PayPal business account and register their nonprofit. From there, you can create a PayPal donate button within your account settings and add the button to your website by copying and pasting an HTML code that PayPal generates for you. 

The standard rate for accepting credit and debit cards on PayPal is 2.89% + $0.49 per donation, but 501(c)(3) nonprofits can get access to reduced rates of 1.99% + $0.49 per transaction. 

Is it safe to use the PayPal donate button? 

PayPal is well-known for its safety and reliability. Similar to other payment processors, PayPal is PCI-compliant to ensure security. It also conducts automatic fraud screenings and provides round-the-clock monitoring of donations.

Pros of using a PayPal donation button

✅ PayPal's brand recognition increases the likelihood of donations

If a supporter is on the fence about giving to your organization and sees the PayPal button, it may increase their chances of donating. 

✅ PayPal plug-in is easy to set up

You can create a PayPal donate button in four clicks, and embedding the PayPal donate button to your website is as easy as copying and pasting an HTML code snippet the company gives you.

✅ PayPal connects with a handful of third-party systems

 PayPal has teamed up with some of the most popular CRMs and fundraising platforms to include PayPal as a checkout option for charities.

✅ Verified 501(c)(3) nonprofits can apply for confirmed charity status on PayPal

Becoming a confirmed charity on PayPal unlocks lower transaction fees and may make you eligible to enroll in the PayPal Giving Fund and receive payments from certain grant-makers.

Cons of using a PayPal donate button

❌ PayPal takes donors to a third-party site

Sending supporters away from your website to donate may feel less secure without your branding or too time-consuming to complete—even if it is just a few more clicks.‍

The solution: Make sure your donors stay on your website by partnering with a fundraising platform that lets you embed donation widgets to accept donations without leaving the page. Here's what previous PayPal user, Aaron Decker, had to say after making the switch to Givebutter:

I love how Givebutter had everything we wanted and more for free! We were able to 5x our usual fundraising event goal because of the interactive live donation display and the help of text-to-donate, which made it really easy for people to give. Our previous donation process gave people our PayPal page link, which didn't tell our mission and story—whereas our Givebutter donation page had all of that info. Also, people couldn't see what they were contributing to on PayPal; Givebutter gave donation titles so people knew what they were supporting by donating.

❌ PayPal was not built for nonprofits

The PayPal checkout experience was originally created for individuals, e-commerce, and small businesses and is not optimized for nonprofits. PayPal does not offer the ideal donor experience to bring donors back again and again to improve donor retention.

The solution: Consider selecting a fundraising platform with payment processing built for charities so that you can raise more funds in the long haul.

❌ PayPal includes limited branding options

You can include your organization's logo and custom donation amounts on the donation form that opens when someone clicks on your PayPal donate button, but you can't customize the checkout experience with your brand's colors, pictures, or videos—which makes it less personal and may turn some donors away.

The solution: Create a customized donation form with your branding to match your website.‍

❌ PayPal does not send automatic receipts from your organization's email

PayPal’s donation receipts are immediately sent to donors, but nonprofits must manually send emails to donors with tax-deductible information. Not only is that a time-waster, but it also takes away from the donor experience. 

‍The solution: Make sure automatic donation receipts are sent from your nonprofit organization's email after an online donation, including a thank-you message with tax-deductible information.‍

❌ PayPal's fees are not transparent

PayPal charges 1.99–2.89% + $0.49 per donation depending on the selected plan, which is unclear on the website. PayPal offers access to funds of multiple currencies (for varying fees), usually within two business days to deposit directly into a nonprofit's bank account. 

However, for instant access, PayPal charges an additional 1.75% for all transfers with an eligible linked debit card or bank account. Ultimately, many nonprofits end up paying 5% + $.49 per donation in transaction fees—not exactly what they thought they signed up for. 

The solution: Choose a payment processing option with transparent fees and include a checkout option that allows supporters to cover your processing fees. 

❌ PayPal has limited support

PayPal offers phone and chat support, but many users report difficulty in getting in touch with support from PayPal at all. Most of the time, users are directed to website links.

The solution: Ask your current fundraising platform or potential candidates more about their support. How much, if at all, is included in your membership? How soon do they promise to get back to you?

3 reasons you need more than a PayPal donation button

Using a PayPal donate button may be the right fit for some smaller organizations; however, many nonprofits find themselves needing more than the PayPal donate button can offer, including the ability to:  

  • Offer a wide variety of payment options 💸 Organizations that let donors use their preferred payment method (including PayPal donations) are the ones who will be able to stand the test of time.
  • Simplify software into one, centralized place 🏡 Organizations that use the PayPal donate button will need other solutions to manage donor relationships, host events, communicate with supporters, and more.
  • See the bigger picture of a donor's giving history 👀 PayPal only tracks transaction history and a donor's email address, making it hard to glean key donor insights and steward better donor relationships.

Go beyond the button with Givebutter

With Givebutter, you get instant access to an embeddable donate button and a full suite of top-rated features to take your fundraising to the next level—including a built-in nonprofit CRM, donor engagement tools, and countless other ways to drive donations online through social fundraising pages, engaging events, and convenient text-to-donate shortcodes—all for free.

Givebutter even offers a native PayPal fundraising integration—making it the ideal PayPal alternative for nonprofits. Not only can you accept PayPal donations, you can also accept donations through Venmo, Google Pay, Apple Pay, all major debit/credit cards, ACH, and in-person payments made via cash or check.

Sign up for your free Givebutter account today to see why more and more nonprofits are choosing Givebutter over PayPal.

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