Download the Credit card processing for nonprofits: A guide for teams & leaders
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Let’s say your organization just announced a new parenting workshop series and families are eager to sign up. But, when parents reach for their credit card to register and pay, they’re disappointed to see that you only accept cash and checks. This seemingly minor inconvenience has now become a barrier for people accustomed to making digital transactions in their daily lives.
This scenario is common for nonprofits relying on outdated payment systems and can often lead to missed opportunities. Whether for the purchase of event tickets or charitable donations, credit card processing for nonprofits is essential in today’s digital world.
In this guide, we’ll explore all you need to know about nonprofit credit card processing so you can make an informed decision for your organization.
Making a credit card purchase is as easy as the swipe, tap, or insertion of a card—but behind the scenes, there’s a lot going on. Here’s a simple look at what happens with credit card payment processing for nonprofits:
Credit card processing benefits both your nonprofit organization and your supporters. It removes friction by making purchases quick and easy for those who prefer digital payments. When you can make a transaction smooth, and hassle-free, your donors will be more inclined to continue their support.
Credit card processing is also held to a high standard of security. Through encryption and compliance with industry standards, you can ensure donors that their sensitive financial information is safe. Providing a secure payment option builds trust, essential to maintaining and growing a supporter base.
Offering much more than convenience, nonprofit credit card processing is a strategic move. It broadens your fundraising capabilities and streamlines administrative efficiency, allowing your team to focus on more mission-critical tasks.
Here are just a few ways credit card processing is used to drive nonprofit operations:
If you’re ready to set up nonprofit credit card processing, you’ll need to choose between opening a merchant account or partnering with a payment service provider. Both have their own benefits and drawbacks, so let’s take a closer look at which would be best for you.
A special bank account called a merchant account, allows a nonprofit organization to process debit and credit card transactions. This is an intermediary account where funds are held before being settled and transferred over to a primary bank account.
Pros:
Cons:
Acting as a go-between for a nonprofit and its supporters, a payment service provider processes credit card transactions through their own merchant account. The provider takes on more responsibility and facilitates the transfer of funds to the nonprofit’s bank account.
Pros:
Cons:
Now that you know the difference between a merchant account and a payment service provider, there are a few other things to keep in mind when making your decision. Depending on the needs of your nonprofit, some of the items below may be more important than others:
These are just a few of the most important elements to consider when deciding on credit card payment processing for nonprofits. Keep in mind that you should also think about smaller details such as transaction speeds, penalties, contract terms, and cancellation fees.
To better understand your options, read plenty of customer reviews and testimonies. You’ll gain valuable insight from other businesses and nonprofits to reveal any potential issues with service reliability.
Most businesses are required to adhere to the Payment Card Industry Data Security Standard (PCI DSS). If you plan on opening a merchant account, you’ll be responsible for ensuring that you comply with these standards. That means you must determine your required level of data protection and the necessary security measures to take.
On the other hand, if you choose to use a payment service provider, they take on more of that responsibility. They must ensure that everything going on behind the scenes is in compliance. However, your nonprofit must still handle this sensitive data properly during the payment process.
Another thing to consider is how you plan to handle processing fees. While some nonprofits choose to cover this expense, many payment service providers give you the option of allowing donors to pay these fees. Depending on the provider, you can make this mandatory or let supporters choose whether or not they’d like to pay this small percentage.
As digital options continue to expand, credit card payment processing for nonprofits has become an essential service. It removes barriers and makes it convenient for those supporters who prefer to swipe a card or pay online for their purchases and donations. Adopting a streamlined payment solution can increase your engagement, donations, sales, and overall user experience.
We hope this guide equips you with the knowledge you need to make an informed decision about the next steps for your nonprofit. It’s important to choose a credit card processor that fits your operational needs while maintaining the highest security standards.
Trusted by 17,000 churches and ministries of all sizes, Subsplash is designed to Fuel Your Mission™ and increase generosity among supporters. Your nonprofit can easily streamline transactions and unify payment processing into a single platform for a fully integrated experience. Whether through your organization’s mobile app or website, you can count on Subsplash for a safe, secure, and engaging experience.
