Facebook fundraisers have become an incredibly popular way for individuals and organizations to raise money for charitable causes. With just a few clicks, you can set up a fundraiser for a cause you care about and rally your network of friends and family to donate. But where does that money actually go? Do the funds go directly to the selected charity or does Facebook take a cut along the way? Let’s take a closer look at how Facebook fundraisers work.
How Facebook Fundraisers Work
When you create a fundraiser on Facebook, you can choose from over 1 million charities to support. You select the charity you want to fundraise for, set a monetary goal, write a story to share why the cause matters to you, and choose a cover photo.
Facebook does not take a platform fee or deduct any payment processing fees for donations made through fundraisers. 100% of the money raised goes directly to the nonprofit organization chosen. Facebook waives fees to enable charities to receive more support. If someone donates $15 to a Facebook fundraiser, the charity will receive the full $15.
Facebook Payment Processing
Facebook processes the payments on behalf of the nonprofit using their payment partners. When someone donates to a fundraiser via credit card or debit card, Facebook uses payment platforms like PayPal and Stripe to handle the transaction securely. These partners charge a small processing fee per donation (around 2-3%), which Facebook absorbs so it does not impact the amount the charity receives.
Transferring Donations to Nonprofits
Facebook collects all donations raised through fundraisers and pools the money together to transfer to the charity in one single payment per month. This eliminates the need for charities to receive and process a ton of small individual donations, which reduces administrative costs. By aggregating the donations and handling the payment processing, Facebook can deliver more money to charities in an efficient way.
The nonprofit organization will see one monthly deposit from “Facebook Donation” appear in their bank account for their total fundraiser amount. Facebook provides fundraiser donation details to the nonprofit through their Cause Dashboard so charities can still collect donor information for tax receipts.
Benefits of Facebook Fundraisers
Here are some of the top benefits of raising money for charity through Facebook fundraisers:
Simple and Quick Setup
It only takes a few minutes to create a Facebook fundraiser. You simply select the nonprofit you want to support, set a goal amount, add a story and photo, and get it shared with your community. Much easier than building your own fundraising site!
Built-in Social Sharing
Fundraisers leverage the power of your existing Facebook network. You can invite friends and family to donate with just a few clicks. Facebook makes it easy to get the word out about your fundraiser organically.
Secure Donation Platform
Facebook provides a safe, trusted payment processing system to collect donations seamlessly. Donors can give money directly within Facebook using their credit card or debit card information.
No Fees for Organizations
The nonprofit organizations receive 100% of the money raised through Facebook fundraisers because Facebook absorbs the small processing costs. This allows charities to maximize donations.
Efficiency for Charities
Facebook aggregates all fundraiser donations into one monthly payment to the charity along with donor information. This reduces administrative work for nonprofits.
Drawbacks of Facebook Fundraisers
While Facebook fundraisers provide an easy and effective fundraising method, there are a few drawbacks to consider:
Limited Fundraiser Duration
Facebook fundraisers can only run for a maximum of 30 days. Other fundraising platforms allow more flexibility for extending the length of a campaign.
Facebook Fees
While charities don’t pay any fees, Facebook does absorb credit card processing fees of 2-3% per donation. This may cut into their overall profit margin for the payment services they provide.
Can’t Add Offline Donations
The fundraiser total only accounts for donations received through Facebook payments. There’s no option to manually add offline cash/check donations from outside of Facebook.
No Customization Options
Facebook fundraisers offer limited customization in terms of the design, messaging, and presentation of the campaign page. Users must work within Facebook’s fundraiser template and features.
Conclusion
In summary, donations made through Facebook fundraisers go directly to the selected charity with no fees deducted. Facebook absorbs the small payment processing costs so that 100% of the money raised reaches the nonprofit organization. While Facebook does take on these costs, they provide fundraisers as a free tool to democratize charitable giving and empower supporters to raise more money for causes that matter to them.
Facebook fundraisers offer a simple, mutually beneficial fundraising solution for charities, their supporters, and Facebook itself. The platform provides easy and secure payment processing, amplified social reach, and optimized donation delivery to nonprofits. So rest assured that when you donate through a Facebook fundraiser, your money goes straight to help the charity and their mission.