While it may make sense for your nonprofit to go through a merchant services provider in order to accept credit and debit card payments, there is another consideration to make. PayPal is a well-established and trusted payment system that is completely web based for most nonprofits.

From a contributor’s perspective, PayPal works in a similar fashion to online banking. He or she sets up an account where money can be sent and received from any other PayPal account. In addition, the PayPal account is generally connected to the individual’s bank account, allowing him or her to transfer funds when needed.

Nonprofits can also set up PayPal accounts. They are also linked to the organization’s bank account. Once set up, you are able to place a “donate now” button on your web site. Any site visitor with his or her own PayPal account (millions of users) can quickly make a donation. The supporter can act instantaneously on an urge to donate, not needing to write a check or even find a credit card to input the numbers and expiration date.

An incredible amount of online commerce is now taking place via PayPal. In fact, it has become so popular that it was purchased by Ebay a few years ago. Users seem to really appreciate the ease and immediacy of the service, and you’re nonprofit can benefit from that. It also limits the amount of personal financial information being shared, as transactions are done between email addresses, with PayPal acting as a go-between. Some donors feel more comfortable knowing that they are not giving their credit card numbers to retailers and nonprofit organizations.

PayPal does charge a fee for most of its services, but this is typically less than what an organization pays for credit card transactions. They do also offer discounted fees for registered 501(c)(3) nonprofits once you have verified your status.