Getting adequate funding is the lifeline for nonprofit organizations. Without funding, they won’t be able to fulfil their purpose-driven missions. However, in a highly digitized world, many nonprofits struggle with adapting to modern technology and leveraging it to maximize donations from donors and supporters. Accepting online payments and diversifying your payment methods is a valuable solution to encourage more donors and ensure you can make a huge impact toward your mission.
Why Is it Important to Diversify Payment Options for Nonprofits?
Nonprofits thrive on donations, so it is vital to simplify and streamline your donors- methods of payment. Providing diverse payment options offers many benefits to ensure continuity in your nonprofit funding.
Convenience for Donors
Diversifying your payment options for nonprofits is beneficial for donors for convenience purposes. Making it easy for donors to give their donations encourages them to continue donating towards your cause. Therefore, it is crucial to remove payment barriers so they can give without any hassle. For example, you can offer bank transfers, credit card payments, cryptocurrencies, and more.
Diversifying your methods of payment also means providing channels to accept payments from international donors. Provide payment facilities that simplify international donors or support different currencies.
Improve Donor Retention
Making it convenient for your donors to pay is a great way to retain their support for your nonprofit organization. Simplified and diversified methods of payment ensure recurring donations and foster long-term donor relationships.
According to The State of Modern Philanthropy report, adding a donation form to your nonprofit website can double the average donation rate. The point is that making it convenient for your donors motivates them to continue donating and increase their donations over time.
Reach a Wider Audience
You can appeal to a broader audience when you offer multiple and diverse methods of payment to your nonprofit organization. Potential donors can use the most convenient method of payment accessible instead of limiting who can donate due to your restricted funding options. It also facilitates a broader socio-economic reach for your nonprofit cause.
Boost Financial Security
Another benefit to a diversified payment method is enhancing the financial security of your organization.
Offering various payment methods reduces reliance on a single financial platform. If you were to rely on a single financial platform, any disruptions in that platform could impact your ability to receive donor funding. It becomes a loss of opportunity, which minimizes your potential to secure funding.
In addition, diversified payment methods provide layers of security to the finances of your nonprofit. It gives donors peace of mind that their contributions are safe and appropriated correctly.
Facilitate Large Donations
Different payment options have different thresholds for how much money can be transferred from one account to another. Providing multiple payment options to donors allows them to maximize the size of their donations. Ensuring that you have payment facilities that can accommodate large contributions makes it easier for your organization to enjoy this benefit, especially if donors prefer specialized payment options.
Increased Relevance
Adapting to new payment and finance technologies makes your nonprofit relevant. Providing payment solutions and channels your donors find easiest to contribute to, will help you innovate, ensuring you can optimize similar methods to obtain funding.
Common Types of Payment Options for Modern Nonprofits
Online payment methods have become popular in recent years due to their convenience and flexibility. Not just younger donors but tech-savvy individuals enjoy the ability to make financial transactions wherever they are in the world.
Modern nonprofits offering multiple payment methods, including online and digital, can increase their monthly revenue. This report states that accepting online payments can boost the funding and revenue of your nonprofit by 40%.
Consider adding these payment options to your modern nonprofit to secure a steady funding stream.
1. Credit Cards
Credit cards remain a significant payment option for modern nonprofits. Traditional credit cards, such as MasterCard, Visa, American Express, and others, are widely accepted worldwide. Therefore, they are a convenient method of payment for many donors, especially internationally. Nonprofits must add this payment option to attract donors who prefer traditional payment methods for nonprofit donations.
2. Bank Transfers
A bank transfer payment option is a modern way to accept donor funding. This method involves taking money from your donors’ bank accounts and depositing that into the bank account of your nonprofit.
Most banks offer transfer payment options, which enable funds to be transferred in real-time. Most donors prefer this payment option for nonprofit funding because of its transparency and convenience. Many donors perform bank transfers online (either on their mobile phone or desktop website), making it hassle-free and efficient.
3. Mobile Payments and Digital Wallets
This payment option is increasingly becoming the preferred choice for providing funding to nonprofits, especially among younger donors. The Global Payments Report 2023 states that by 2026, 41% of all transactions will occur via a mobile payment platform or digital wallet.
The rise in mobile payment solutions is evidence of this, with mobile banking apps a quick and convenient way for users to pay. These mobile banking apps and digital wallets can transfer money using QR codes or input payment details through an app. Aside from mobile banking apps, digital wallets like Apple Pay or Venmo are also convenient payment solutions that nonprofits can utilize.
With more mobile users and developing mobile technology, expect this payment method to continue to grow over time. Therefore, nonprofits should offer this payment method to capture younger donors.
4. Cryptocurrency
Cryptocurrency is another fast-growing payment method among nonprofits. The main draw of cryptocurrency donations is the security it offers, along with some tax benefits. Whether you adopt this payment method entirely or not, it’s an excellent option for donors who feel more at ease using this payment solution.
Diversifying your payment options for a nonprofit organization is one of those rare times when you can claim that more is better. With payment processing solutions that ensure the lowest fees and maximize the revenue opportunities for your nonprofit, you can facilitate a streamlined and convenient payment solution for your donors.