In other articles, I’ve talked about how adding more payment options has helped my organization. By including mobile and online payments, we’ve seen an increase in donations across our donor demographic. This includes praise for direct debit, debit and credit cards and mobile payment tools.
Now, with the advent of digital currency, also known as cryptocurrency, we began exploring the potential for adding it as a new payment option in our fundraising efforts. Some nonprofit foundations like Beam and the Royal National Lifeboat Institution started accepting Bitcoin as early as 2014. And in 2017, there were stories of more nonprofits starting to migrate to this payment-acceptance method. With numerous nonprofits already using cryptocurrency, it seemed to me like there should be a wider adoption.
With the spotlight on cryptocurrencies like Bitcoin, with a value that has skyrocketed as well as experienced roller-coaster pricing, it led us to tally up the benefits and risks of using cryptocurrency in our nonprofit. Here’s what we found.
Lower Processing Fees
One of the issues with accepting debit and credit cards is the fact that we get hit with high processing fees. While we may have increased our number of donors with this payment method, the fees eat into what we could get in terms of donations. With cryptocurrency, there are no banks or credit card companies involved in the transactions. That means a much lower processing expense.
Sites like Coinbase and BitPay make it easy to accept this type of currency and offer very low transaction fees. These sites have been verified as legitimate and safe ways to accept donations with this currency. In fact, Coinbase has helped nonprofits by allowing them to accept a certain amount of cryptocurrency with no transaction fees.
Fast, Efficient Transactions
Because there are fewer people and processes involved, cryptocurrency transactions are fast and efficient. You won’t be dealing with paperwork or extra steps just to get the money. With traditional payment processes, it can take three or more days to have the money in your account. The timeframe could be even longer when dealing with an international payment.
The quick transfer of cryptocurrency results in donations delivered faster so you can put that money to work. This can be a great help to getting started on a project or maintain good cash flow in your nonprofit.