Benefits of Choosing Online Payment Processing for NonProfit

Ashok Sharma
5 min readMar 2, 2022


This “Benefits of Choosing Online Payment Processing for NonProfit” originally published March 1, 2022 by Scott Dickens.

Payment Processing for NonProfit

Businesses are continuing to shift towards digital payments for easy and secure transactions. In fact, Payment Processing for Nonprofits is also adopting digital payment processing solutions as a fast, reliable, and contactless way to exchange money. Payment processing for nonprofits, aka nonprofit donation solutions, refers to the system that facilitates online payments.

Here’s a rundown of what you can accomplish by partnering with a nonprofit payment processing provider.

To Collect Membership Fees

Many supporters that believe in nonprofit causes show their support by joining a nonprofit membership program, and most memberships have a monthly or annual fee associated with them.

Securely Collect Donations

With the evolving technology, cyberattacks and security breaches are also on the rise. Suspected digital fraud attempts rose 25% during the first four months of 2021.

Although this number is high, the good news is that solutions to ensure security and risk mitigation are readily available. For example, paper credit card slips can get misplaced and end up in the wrong hands. With an online payment solution, sensitive details are encrypted and transmitted directly to the financial institution, keeping them protected from outside interference.

Focusing on boosting security shows donors you have their best interests in mind, which can go a long way towards obtaining repeat donations.

Higher Credibility

Digital payment methods are positioned to influence the business landscape and consumer market. Nowadays, most users prefer making payments via online payment processing platforms. Therefore, embracing digital payment processing for your nonprofit to fit this criterion raises credibility towards your fundraising platform. For instance, churches that started accepting tithing online have seen a 32% increase in donations.

Recurring Donations

Online payment processing enables you to set up automatic recurring donations and a widely used credit card processing system. Regular benefactors contribute 42% more to charity than one-time donors. It also allows nonprofits to build more precise financial plans for their future events.

Get Access to Fundraising Features

Some payment processing companies offer a comprehensive suite of fundraising options for their nonprofit clients (like crowdfunding, text donations, and online donations). So, look for different fundraising capabilities that come with a payment processing provider.

No Processing Fee

Many online payment solution providers charge several payment processor fees (recurring, per-transaction, and incidental costs). Choosing a payment processor that is completely free and transparent can make a huge financial impact on your nonprofit organization.

Higher Retention Rate

Payment processing has the potential to save a business money and improve time, efficiency, and cash flow. Smooth access of funds via online processing methods makes digital payment easier.

However, it’s not just about simplifying the payment process; it’s also about creating a fast, easy, and secure user experience that eventually improves donors’ retention rate. When donors see how secure and efficient the donation process is with your nonprofit, they are more likely to give again.

With a seamless and effective payment processing platform, you can start your nonprofit on the path toward better donor retention.

Payment processors enable nonprofit supporters to pay their membership dues online without any hassle.

How to Ensure Donors Payments Are Secure

One of the critical factors to consider while choosing a payment processor is ensuring that your donors’ sensitive financial details are secure. Let’s discuss what measures to put in place to ensure donor payments are secure.

Ensure payment processors comply with PCI

The Payment Card Industry (PCI) Security Standards Council has defined data security standards to protect merchants and contributors. PCI-compliant institutions and organizations adhere to these standards. There are various levels of PCI compliance, and it is critical to ensure payment processor providers maintain the highest level possible.

PCI compliance is vital for nonprofits; failure to adhere to these standards can result in penalties and fines!

PCI compliance confirms donors that their gifts are protected and secure. It will enable your donors to trust using your online giving channels for payments. And, of course, you don’t want to put their information at risk of a security breach.

In addition to PCI compliance, there are various other payment processing security features that nonprofits should know:


Tokenization is critical to integrate into any payment processor mandated by PCI standards. It involves replacing information like credit card numbers with a string of letters and numbers, which creates a barrier between a donor’s financial and personal details and potential hackers.


Encryption protects information that donors send, receive, or store as it was entered into “cyphertext.” Cyphertext is a code that can only be understood if opened with the right key. Algorithms manage the encryption process and protect details as it moves through the stages of the payment process.

Fraud Protection

There are payment processors that offer several fraud protection services. Mainly, these services help verify a donor’s sensitive details and block access from malicious attackers.

Key Terms Associated with Payment Processing

Here we have explained some of the important terms related to payment processing that you must keep in mind.


ACH, known as Automated Clearing House, provides electronic funds transfers (ETFs) between banks and merchant accounts. ACH processes are accomplished in batches, taking up to 72 hours to be completed.

Third-Party Processor

A third-party processor enables nonprofits to accept online donations without having their own merchant account. The processor provides access to nonprofits to use their merchant account after agreeing to the terms of service.


VPN is a virtual private network that provides a robust internet connection for payment processing. A VPN uses data encryption to mitigate the risk of fraudulent payments and prevent unauthorized users from attaining access.


An aggregator is a large corporation that processes transactions and donations on behalf of many small-sized businesses and nonprofits that are in its portfolio. PayPal and Stripe are examples of aggregators.

Payment Gateway

A payment gateway is a fraud prevention method practiced by payment processors. Payment gateways protect donors’ credit or debit card information during and after the donation process.

Merchant Account

A merchant account is a bank account that enables a nonprofit to accept online donations via credit or debit cards. This account is established under a nonprofit and a merchant-acquiring bank contract.

Next Move

A payment processing platform that is secure, fast, and reliable helps you improve your bottom line in the short and long run by saving time and money on manual paperwork and optimizing donors’ experience that brings them again to your website.

So, while going digital for the payment process, make sure you research for the renowned and experienced payment processing provider.



Ashok Sharma

A #DigitalStrategist, Marketing Consultant, #SOCIALMEDIA INFLUENCER, and #GrowthHacker