GiveMN to charge 2.9% on donations to MN nonprofits
Well, it was great while it lasted. And frankly, it's still pretty darn good.
What used to be a free transaction on GiveMN will soon have a 2.9% charge associated with it.
For the past nine months GiveMN's website has become a clearinghouse for Minnesota nonprofits, creating a central location for people to give to their favorite charity or arts organization. And for all this time, neither the organization nor the donor has been charged any sort of transaction fee; 100% of each contribution went straight to its intended recipient.
Starting October 1, that's going to change.
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GiveMN's site is run by the server provider Razoo, and up until now its financial transactions have been handled by the organization Network for Good, which charges a 4.75% handling fee. The funders of GiveMN, a group of foundations, have been paying that fee so that the nonprofits could get the whole benefit of donors' generosity.
GiveMN announced back in April that its original budget couldn't cover the costs of the vast number of transactions it was soon supporting.
Since November 17, 2009, the site has transacted approximately 18 million dollars in donations, made by 50,000 people to 4,000 nonprofits. Almost 3,000 nonprofits now use the site regularly for their fundraising. Note: the vast majority of that giving - 14 million of it - was made on Give to the Max day last November.
Starting October 1, Network for Good will be replaced by U.S. Bank,
which is offering its services for a significantly lower 2.9% transaction fee.
which will allow Razoo to offer its services for a significantly lower 2.9% transaction rate.
GiveMN Executive Director Dana Nelson says she's thrilled with the new arrangement.
Basically, they're donating their services to GiveMN and Razoo. A credit card transaction rate is made up by a bunch of different costs, so what they're doing is eliminating their part of that cost.
Nelson says 2.9% is one of the best rates, if not the best rate on the market.
In order to become fully sustainable, the organizations receiving donations via GiveMN will now get their donation, minus the 2.9% transaction fee. Nelson says while she would have loved to be able to continue to cover the fees forever, this is still a very good deal for small nonprofits looking to streamline online contributions.
At this time we're just so excited to be able to offer one of the best rates we can. The value of the service - no set up fees, great social media tools, fundraiser pages and project pages - all provided without any cost to the user... that's a lot to offer non-profits in MN.
Nelson says funders might step forward to cover transaction fees for particular fundraising projects or events, but she doesn't see GiveMN returning to a transaction-free model again in the future.