monthly fees for non-profit merchant account

Today’s inquiry is where can I get a merchant account with no monthly fees? The question is for a new non-profit 501c3 with less than $25,000 annual projected in credit card processing. The group needs a both a virtual terminal and online donation capability.

Answer: I don’t know any suppliers with zero monthly fees that would meet the requirements for the specifications above. My recommendation is to get a paypal Website Payments Pro account for $30 per month. The non-profit rates for the volume are as good as it gets. You’re going to pay fees whether it’s higher monthly and low rate or low monthly and high rates. I think Paypal offers some benefits for newbies with their instant online donor form, and the contract is month to month.

Step by step on paypal:

>Payment Solutions

>Accept Credit cards non-profit

>Sign up for a PayPal Business account If you don’t need a virtual terminal, you’ll select business/standard account/type of business, non-profit.

Discounted fees for nonprofits with 501 (c)(3) status

More than $100,000 in monthly volume: 1.9% + $.30 per transaction

Less than $100,000 in monthly volume: 2.2% + $.30 per transaction

There is no monthly fee. All other nonprofits are charged regular transaction rates. Discounted rates do not apply to transactions made using Website Payments Pro or Virtual Terminal.

If you need a virtual terminal, you’ll select Business>website payments pro. The non-profits rate do not apply! Pricing as of 12/15/2010:

  • $30 monthly fee
  • 2.2% – 2.9% + $0.30 USD per transaction* (Visa, MasterCard, Discover)
  • 3.5% and no fixed fee per transaction (American Express)

Note- fees are likely to go up again in April 2010, as a result of the bi-annual interchange update.

For a new non-profit you need to estimate how many transactions you’ll have a month, and a dollar volume. Assume 50% of your transactions will be a the lowest quoted CARD NOT PRESENT rate. Assume 50% will be at the highest quoted ECOMMERCE rate. This is a general guideline to help you compare different options you may be considering.

The above information does not apply to larger volume non-profits. Click this link for related article:

industry insider reviews merchants fees for non-profits

3 thoughts on “monthly fees for non-profit merchant account

  1. Pingback: Quora

  2. Plenty of merchant service companies offer “lower rates” for charities and non-profits. Paypal is not the best option out there although it sounds great on paper. I work specifically with 501(c)(3) for a merchant service company. The fees are normally much lower than $30 and a 2.2-2.9 flat rate is taking a much higher percentage than you would qualify for. Save some money and do your research. Certain merchant services even have a give back program such as Generate4U. Look into these programs before going with the Paypal “catch all”

    • The question is for a new non-profit 501c3 with less than $25,000 annual projected in credit card processing. The group needs a both a virtual terminal and online donation capability. I stand by my original recommendation. Paypal for the small business reduces scope for PCI Compliance (Payment card industry data security standards). A lot of them won’t make it. A lot of them will push checks. It’s not worth the effort to comply with all the requirements needed for PCI etc for a very small merchant of any kind.

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