Insights

The Secret to Eliminating Donation Fees

Extra fees. They seem to plague us wherever we go. It seems as though everything has hidden costs and add-ons that can send any company’s accounting department into a tailspin of panic. When it comes to your corporation wanting to give back to their community, however, it just doesn’t seem right to have to worry about extra fees while spreading goodness to those in need.  


Costs associated with donations, aka donation processing fees, have been a hot topic of conversation lately. While the actual cost of processing donations varies, many believe that corporate giving donation fees are too high and are discouraging companies from giving more to causes they care about.

Corporate giving platforms are, by and large, the most efficient way for companies to make donations to charitable organizations. They save time and cut down on administrative work for all parties involved. For example, checks—which are still a surprisingly popular way to make donations—require a lot of administrative resources to receive and process. Donations made by check are more expensive for donors to use and more expensive for charities to receive. This is why choosing to donate through an online platform (via electronic fund disbursement) is the best way for companies to award grants, matching gifts, and other corporate donations.

But what about the fees?

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Corporate giving software companies typically charge anywhere between a 2.9 to a whopping 10% fee for donation processing. These companies claim the extra fee is going towards covering administrative costs. At DonationXchange, however, we believe in maximizing your charitable impact while minimizing the cost it takes to deliver your generous gift into the right hands. That is why our extra donation fees do not exist. All administrative tasks are covered by us.

The only costs associated with donations made on our platform are ACH fees, which cost a fixed rate of $2 per batch transaction and are not based on a percentage of the funds being donated. When it comes to employee donations, our clients often choose to utilize our automatic payroll deduction feature since it eliminates the need for credit cards, and thus, removes all extra costs associated with individual employee donations. Without these extra fees, corporate donors and their employees can give more to the causes that matter most to them.

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Focused on the cause

It’s simple. DonationXchange was built out of an esteem and respect for the philanthropic process, and we have never charged our clients extra fees. Recently, other companies have begun to share our belief that more money should go to the actual charities the donations are designated for and not toward ambiguous “administrative fees.” GoFundMe and Facebook recently took steps to eliminate some of the fees associated with running fundraising campaigns on their corresponding platforms. GoFundMe, a major player in personal fundraising, has removed the 5% platform fee it used to charge campaigns launched by individuals and now offers donors the option to provide a “tip” to cover campaign fees. For now, the platform fees will still apply to campaigns launched by organizations. Facebook took the opposite approach by electing to waive its platform fee for organizations (including all payment processing fees) while retaining fees for personal fundraisers. This is a big step in the right direction and will allow millions of additional dollars to flow to worthwhile causes.

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The bottom line 

Processing donations does cost money. Administrative tasks, tax receipts, thank you letters, etc., are just some of the things that take up a charity’s resources when receiving a donation. The DonationXchange model covers all the associated costs of donations in order to take the burden off of the charities, eliminate processing fees for donors, and ultimately put more dollars towards spreading goodness and impacting our world through the human spirit of giving. Extra fees should never hinder a company’s ability to give back to the cause or causes they are passionate about supporting.  

Find out how to boost your corporate giving programs while saving time and resources with the DonationXchange Philanthropy Platform.

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