Should Churches Use PayPal for Online Giving?
As online payment processors and technology evolve, many organizations are considering new solutions. While PayPal for churches can serve a valuable purpose for congregations, churches’ needs are more specialized compared with retailers, so many are looking for platforms that can meet these needs.
Specifically, churches are more focused on processing donations, either recurring tithes or campaign-related donations. Here are eight reasons why using PayPal for church giving might not meet churches’ needs.
1. Inspiring Generosity
Churches want to be sure their members feel connected to the causes their ministries support. Unlike PayPal’s drop-down menus that only provide short, generic names for the causes that are listed, churches want to share the story of each cause with rich visuals and descriptions that increase churchgoers’ generosity. Find out how powerful, image-based storytelling can inspire your congregation to give.
2. Need for Recurring Donation Options
When it comes to recurring donations, PayPal only offers church members the option to give monthly. According to Vanco’s 2023 Definitive Churchgoer Giving Study, only 20% of churchgoers prefer to give monthly, so additional options are a must. Also, using text to donate with PayPal isn’t an option.
3. Technical Support
PayPal customers have a very difficult time getting help when they need it, and talking to a live person for support is virtually out of the question. Worse yet, organizations are often notified of random, unexplained 21-day holds that they can’t fix on their own, and they can’t reach anyone for help.
4. Integration Needs
PayPal doesn’t focus on the integrations churches need to run their organizations effectively, especially with church management software programs. Integration with church software is critical because it saves staff time and increases the accuracy of records.
5. Church-Specific Functionality Needs
PayPal for church tithing doesn’t have church-based functions. It provides functions related to raising funds, but churches need more. For example, many churches rely on online platforms to manage their events (tickets, seating) and social connections (worship services, church group chats, interactions with church leaders).
6. Added Processing Time
The process of receiving funds via PayPal involves first receiving the money in a PayPal account and then transferring it to a bank account. This creates additional processing time and delays access to the funds.
7. Potential Cost
What does PayPal charge churches? It’s more expensive than it looks at first glance. This is because PayPal charges confirmed charities a 1.99% processing fee for ALL donations and payments, which is not the case for many vendors including Vanco.
Expensive Fees for Donations via Bank Transfers
While PayPal’s rates for ACH payments are the same as their credit card rates (1.99%), for many church giving platforms, the cost for bank transfers is much cheaper. In many cases, it is roughly half the cost. According to Vanco Payments Churchgoer Giving Study, which interviewed 1,000 churchgoers across denominations on their giving preferences, 34% preferred to give through ACH. With so many churchgoers giving by ACH, this extra ACH cost can really add up.
8. Potential Fraud
While PayPal offers secure giving, donors are still susceptible to fraud. This happens when a fraudster mimics a charity and accepts funds on its behalf, but there’s no way for churches or donors to recover those funds.
Now that you understand some of the challenges churches are finding when they use PayPal, keep reading to learn more about another great option. Consider a platform built specifically for churches, with their unique needs, relationships and opportunities in mind.