PayPal Giving Fund: A Good Fit?

Many charities and organizations are utilizing PayPal's Giving Fund as their main source of online donations. PayPal Giving Fund is an IRS-registered 501(c)(3) public charity that uses PayPal technology and resources to help fundraise for causes. More than 175,000 charities have already enrolled in this program, according to the PayPal Giving Fund website.

While this service can be very beneficial to organizations, there are fine print and details we believe donors and organizations should be aware of before making this their only, or primary, online donation platform.

We will outline some pros, cons, and additional options for donors organizations. Knowledge is power! “The goal is to turn data into information and information into insight.” – Carly Fiorina, former chief executive officer, Hewlett Packard.

How PayPal Giving Fund Works

First, you must set up a PayPal account for your charity. Next, you will need to confirm your charity's identification and business account. You can do this through their website.

According to PayPal Giving Fund, Donors may make a donation and recommend their charity of choice. However, all donations made through PayPal Giving Fund programs are made to PayPal Giving Fund, a Donor Advised Fund recognized by the Internal Revenue Service, with each donor recommending a charity to which the donor wishes the funds to be granted.

PayPal Giving Fund receives the donation and then attempts to grant it to the charity you recommended. Before the distribution of the grant, the money is held in a secure, non-interest-bearing bank account.

Then, the recommended charity receives a grant from PayPal for the donation amount.

Usually, it takes 15-45 days to grant a donation to a charity enrolled with PayPal Giving Fund. It can take 90 days or longer if the charity isn’t enrolled with PayPal.

What Works Well with PayPal Giving Fund?

💰 No Fees: There are no transaction fees for the charity.

🧾 Receipting: Receipts and reporting are handled by PayPal Giving Fund.

🌎 Global Reach: PayPal Giving Fund puts your charity on a platform that has a broad reach.

👍 Easy Enrollment: Your organization only needs a PayPal account to get started.

🔗 Find these facts and more on the PayPal Giving Fund Website

Things to Consider about PayPal Giving Fund

🤞 Recommendation and Reassigned Donations: Donors are making a recommendation for their donation to go to their charity of choice. Yes, PayPal Giving Fund makes an effort for the donor's chosen nonprofit to receive the grant, however, it is not guaranteed. PayPal Giving Fund retains exclusive, legal control over all donations. See more information in PayPal Giving Fund's Donation Delivery Policy.

🤷 Disconnect from Donors: The gifts are given to PayPal Giving Fund, which in turn will provide a grant to your organization. Donor information is only available if the donor checks the box and you must find it in your PayPal Dashboard.
Receipts are sent from PayPal which is simpler, however, organizations are missing an opportunity to connect directly with the donor in this process.

⌚ Waiting for Payment: Grants are usually paid out 15-45 days after the donation is made. It can take 90 days or longer if you are not enrolled with PayPal.

📝Lack of Customization: The PayPal Giving Fund giving pages lack customization. Many organization's pages have a very similar look with only the logo and image appearing unique for each organization. The preset giving options have a lack of connection to the impact and lack of labeling options.

Additional Options

There are many giving platforms available for nonprofit organizations and PayPal Giving Fund is a viable option for nonprofits. However, there are also other options available as well with additional features.