Do Donation Platforms Take a Percentage? Nonprofit Platform Fees Explained

Here is a question we have been asked more times than we can count: "Does the software take a percentage of our donations?" For many nonprofits, the answer is yes. Nonprofit platform fees are often charged on every gift, and a lot of teams do not realize it until they look closely at their deposits.

This post explains how nonprofit platform fees work, how they differ from payment processing fees, how to find out what you are really paying, and why we built DonorsBase to charge 0%.

Two different fees on every online gift

When a donor gives $100 online, two different kinds of fees can be deducted before the money reaches your bank account.

Payment processing fees go to the company that moves the money, such as Stripe or PayPal. Every card transaction has one, and they are unavoidable in some form, though processors like Stripe offer discounted rates for eligible nonprofits. We explain how to lower them in our guide to payment processing fees for nonprofits.

Platform fees go to the software company. They are usually a percentage of every donation and are charged on top of processing. This is the fee that varies the most between vendors, and the one most worth questioning.

Sometimes the two are bundled into one number on your statement, which makes it hard to see how much is going to the software company. If your platform quotes one combined rate, ask what portion is processing and what portion is the platform.

How to find out what you are really paying

If you are not sure whether your current platform takes a percentage, here is a quick check:

• Pick one month and add up the total donations your donors gave.
• Add up the deposits that reached your bank account for that month.
• Subtract your processor's published rate for those transactions.
• Whatever is left is what your platform is keeping.

Many organizations we have spoken with were surprised by the result. The fee was in the contract, but nobody had added it up across a full year.

Why percentage-based nonprofit platform fees add up

A platform fee looks small on a single gift. The problem is that it scales with your success. The more you raise, the more you pay, even though you are using the same software.

Consider an illustration: a charity that raises $250,000 online in a year on a platform taking 4% would pay $10,000 in platform fees alone. If a successful capital campaign brings that to $400,000 the following year, the fee becomes $16,000. That is money donors gave to feed families, fund scholarships, or keep the lights on at a shelter. It never reaches the mission.

There is also a trust question. Donors increasingly want to know how much of their gift reaches the cause. It is hard to explain to a major donor that a portion of their gift went to a software provider simply because it was processed online.

Why we decided to charge 0%

Our founders did not set out to build donor software. Growing up, our mother used to take us to visit an orphanage, to play with the children there and bring them new toys. That habit of giving stayed with us. Years later, Orthoplex began when we volunteered to build a free website for our church, and other charities started asking for help. We spent a decade working alongside them.

In those years, we kept hearing the same complaints. Teams told us their software provider was taking a percentage of every gift. Finance leads told us their costs jumped after their best campaigns. Board members asked why a technology bill was tied to fundraising results at all.

We looked at the market and realized these were not isolated problems. So we built DonorsBase around one principle: your donors give to your mission, not to fund your software.

DonorsBase takes 0% of donations. You connect your own payment processor, so you keep your own rates and your own relationship with that provider. We charge a flat rate based on the number of donors you manage, with unlimited donations and unlimited staff seats. You can see how it fits together on our features page.

When Anba Abraam Charity switched to DonorsBase, they cut their monthly software cost by about 75%, and none of their donations go to us.

Is a percentage fee ever the right choice?

To be fair, a percentage model can make sense for a brand-new organization that is raising very little and cannot commit to a subscription. In that case, the fee is small in dollar terms and there is no upfront cost.

The key is to know when you have outgrown it. As a rule of thumb, once your annual platform fees are larger than a flat subscription would cost, you are paying for your own success. Run the numbers at least once a year, and use the total-cost worksheet in our guide to donor management software cost.

Questions to ask any vendor about fees

Before choosing a platform, ask these questions and get the answers in writing:

• Do you take a percentage of donations? If so, how much, and on which transactions?
• Is the platform fee charged separately from processing, or bundled?
• Can we use our own payment processor and our own negotiated rates?
• Do you ask our donors for tips or "optional contributions" to your company?
• Will our price change if our fundraising grows?
• Are event tickets, recurring gifts, or peer-to-peer donations charged differently?

The Council of Nonprofits' guidance on ethical fundraising is also a useful reminder that donors expect their gifts to be used as intended, which includes how much goes to intermediaries.

For a full walkthrough of what else to ask, see our list of questions to ask donor management software vendors.

If you want to see what your organization would save, talk to our team.

Frequently asked questions

Is a platform fee the same as a processing fee?

No. Processing fees go to the payment company. Platform fees go to the software vendor and are usually charged in addition.

How do I know if my platform takes a percentage?

Compare a month of donations with the deposits you received, subtract your processor's rate, and the difference is what your platform keeps.

Can donors cover the fees?

Many platforms, including DonorsBase, let donors choose to cover processing fees at checkout. That is different from asking donors to tip the software company.

Does DonorsBase take any percentage at all?

No. DonorsBase takes 0% of donations. You pay a flat rate based on donor count.