Why Your Nonprofit Should Accept PayPal Donations

This blog was written by Korrin Bishop in collaboration with PayPal.

Nonprofit payment processors are about more than pricing and processing fees. They offer payment flexibility and empower donors to choose their preferred payment method. Additionally, accepting PayPal for online fundraising and donations helps you reach a wider donor audience.

Our internal Classy platform data found that one-time donations are 30% larger on PayPal than on credit cards and 20% larger than on digital wallets. Additionally, we’ve seen that organizations offering PayPal and Classy Pay have a 4-point conversion lift compared to organizations with neither.¹

Below, we’ll share more about PayPal and how your nonprofit can use Classy Pay to accept PayPal donations easier. We’ll also detail five reasons why you’ll want to add this flexible payment to your donors’ giving options.

What Is PayPal?

PayPal is a service that allows you to make payments, send money, and accept payments without entering your financial details each time.

The PayPal platform has over 400 million active accounts and is available in more than 200 markets and 100 currencies. In fact, in a Statista Global Consumer Survey conducted in the United States in March 2023, PayPal was the most used online payment service, with a user share of 81%.²

Additionally, PayPal is the most trusted brand to keep financial information secure.³ This is critical, as digital wallets must be able to securely store individuals’ payment information, including major credit cards, debit cards, and bank accounts. When customers are ready to pay, they can select from any payment options in their digital wallet for a safe, easy payment experience.

Of PayPal donors surveyed, 37% said they donate more money because they can use PayPal. Likewise, more than half of donors who made monetary payments to a nonprofit in the U.S. said they’re likely to donate again if a nonprofit offers PayPal accounts as a payment form.⁴

If you currently use the Classy platform and have Classy Pay activated, here’s how PayPal checkout works:

• First, donors select PayPal as a checkout option, as with the current experience for ACH bank payments, credit cards, and other digital wallets.
• Next, donors get prompted to log into their PayPal personal account to donate directly, typically through a stored credit card or bank account.
• Then, Classy Manager stores the transaction data, including donation amounts, just like a standard online fundraising transaction.
• Finally, the donor gets routed back to the confirmation page to review a summary of their fundraising transaction and share it on social media after completing their transaction.

PayPal is an account-level setting, enabled or disabled at the organization level.

The PayPal online donations integration provides supporters with more flexible and frictionless payment options. In doing so, you meet them where they are by presenting them with the same technologies they interact with every day, like the PayPal app.

5 Reasons to Accept PayPal Donations for Your Nonprofit

At the core of why your nonprofit should accept PayPal donations is the ability to increase your conversion rates. Below are five specific benefits a PayPal option offers for driving conversion.

1. Donors Want Flexible Payment Options

Payment flexibility drives conversion. Our State of Modern Philanthropy report found an 11% to 14% increase in mobile conversion rates when organizations enable digital wallets. Additionally, Classy’s Why America Gives report found that 39% of donors say providing multiple mobile payment processors, including PayPal, could help provide an excellent online giving experience.

2. The PayPal Brand Can Increase Donor Trust

PayPal has been a trusted brand for more than 20 years, even ranking as the second most trusted brand globally by Morning Consult.⁵ Donors are familiar with PayPal and what it offers, such as fraud detection, 24/7 monitoring, and encryption technology. In fact, 93% of PayPal users surveyed trust nonprofit organizations that offer PayPal.⁶

Meanwhile, Classy’s Why America Gives report shows that 72% of millennials and 66% of Generation Z are most likely to partake in a PayPal donation if they know an organization they want to support solicits donations this way.

Offering PayPal as a payment method on your donation page means you can reach donors with an online payment brand they trust.

3. Barriers to Payment Processing Are Barriers to Donations

A donor may want to give to your campaign but can’t physically get their credit or debit card to enter all their payment information into your donation form. They may also not want to have to look up their bank account number and routing details to set up an ACH payment.

Why America Gives shows that 20% of donors have reconsidered charitable giving altogether because the nonprofit didn’t include the payment option they wanted to use. Conversely, PayPal users are 3.7X more likely to donate when PayPal is an option.⁷ This is because PayPal helps minimize friction to create a modern donation experience.

All your donor needs to do for an online donation on the Classy giving platform via PayPal is log into their account with PayPal and select from one of their stored funding methods. Reducing friction in the donation process can help drive more donations.

4. A Global Product Opens the Door to More Supporters

If you hope to reach a broader audience, PayPal is the payment method for your organization. Not only is PayPal a global platform that will allow you to collect donations from supporters worldwide, but PayPal has access to over 200 world markets, meaning donors can customize their currency.

5. PayPal Features Can Revamp Your Donate Buttons and Giving Options

Displaying the recognizable yellow PayPal donate button alongside your other donate buttons leverages donors’ trust in the PayPal brand to drive the completion of their transactions. It can also encourage recurring donations from supporters who may want to use their existing PayPal balance for monthly giving rather than a new charge to their credit card or bank account.

Additionally, you can use QR codes to direct supporters to the PayPal payment option for your donation page. This creates an easy, mobile-friendly giving process.

Leverage Classy Pay to Accept PayPal Donations

Donors value trusted payment options that meet them where they are. With Classy Pay, you can offer PayPal on your donation forms and give your supporters the option to donate using a well-known, convenient, and safe payment method.

You can learn more about how to accept PayPal donations with Classy Pay in our PayPal and Venmo for Classy Pay FAQ.

Copy Editor: Ayanna Julien

Article Sources

1. Classy Platform Analysis, Assessment of Giving Season PayPal Trends, Involved 1,500 Classy customers, January 2022.

2. “Most Used Mobile Payments by Brand in the U.S. in 2023,” Statista, last modified June 6, 2023, https://www.statista.com/forecasts/997117/most-used-mobile-payments-by-brand-in-the-us.

3. TRC Online Survey, Commissioned by PayPal, Involved 5,000 consumers ages 18+ across US, UK, DE, FR, AU (among Millennial & Gen Z BNPL users (ages 18-40), US (n=214), UK (n=258), DE (n=262), AU (n=369), FR (n=157), April 2021.

4. Logica Research, Commissioned by PayPal, Surveyed 4,306 PayPal user respondents from four countries (U.S., Canada, Australia, and U.K.) who donated to a non-profit PayPal merchant. N=1,029, March 23-April 2, 2021.

5. “Most Trusted Brands 2021,” Morning Consult, accessed June 6, 2023, https://morningconsult.com/most-trusted-brands-2021/.

6. Nielsen, Commissioned by PayPal, Nielsen Media Attitudinal Survey of US (January 2022) with 400 recent donations (past 3 months) to Non-Profit organizations across 338 PayPal users, April 2022.

7. Nielsen, Commissioned by PayPal, Nielsen Media Behavioral Panel of US with Non-Profit desktop donations transactions from 1,720 consumers, January 2021 to December 2021.