How to Collect Nonprofit Donations Using Square

Nonprofits are rapidly embracing modern payment solutions like Square to boost their fundraising efforts. 

A recent study by the Blackbaud Institute reveals that online giving grew by 21% in 2020, highlighting the critical need for efficient digital donation processing. 

For years, charitable organizations have grappled with clunky donation systems, high processing fees, and complex financial reporting. 

Square offers a breath of fresh air, providing a user-friendly solution that's as suitable for grassroots initiatives as it is for established foundations. 

But what makes Square stand out in the crowded field of payment processors for nonprofits?

Let’s discuss!

What is Square?

Square is a comprehensive payment processing platform that has been making waves in the business world since its inception in 2009. 

Since then, it has evolved into a multifaceted financial services and mobile payment company that caters to a wide range of organizations, including nonprofits.

At its core, Square provides a suite of tools that allow organizations to accept payments in various forms – be it through in-person transactions, online payments, or mobile transfers. 

For nonprofits specifically, this versatility translates into the ability to collect donations through multiple channels, meeting donors where they are and making the giving process as frictionless as possible.

Can Nonprofits Use Square for Donations and Fundraising?

Yes, nonprofits can use Square for payment processing and donation collection.

This payment processing platform offers a range of features for nonprofit organizations, including customizable donation buttons, reocurring donations, and donor data managment tools.

Square's Features for Nonprofits

Square offers a comprehensive suite of features for nonprofits, making donation management and fundraising more efficient and effective.

With automatic receipts, centralized donor data management, and recurring donation options, your organization can streamline its administrative processes while building stronger relationships with supporters.

Square's donation buttons and integrated online and offline donation capabilities ensure that your nonprofit can accept contributions across various platforms and settings.

Additionally, the platform's fundraising event management tools simplify ticket sales and on-site donations.

Nonprofits can leverage these features to enhance donor engagement, maintain a steady income stream, and focus more on their mission by reducing administrative burdens.

Square's Fees for Nonprofits

Understanding the fee structure is crucial when selecting a payment processor for your nonprofit.

Square offers a transparent and competitive pricing model that can be advantageous for charitable organizations.

Let's break down Square's fee structure and compare it to other options in the market.

Transaction Fees Overview

1. Breakdown of fees for different transaction types:

   
   

   • In-person transactions: 2.6% + $0.10 per transaction

   • Online transactions: 2.9% + $0.30 per transaction

   • Manually keyed-in transactions: 3.5% + $0.15 per transaction

It's important to note that these rates apply to all U.S. issued cards from American Express, Visa, Mastercard, and Discover.

2. Comparison table: Square vs. other nonprofit payment processors

Processor	In-person Rate	Online Rate
Square	2.6% + $0.10 per transaction	2.9% + $0.30 per transaction
Stripe	2.7% + $0.05 per transaction	2.9% + $0.30 per transaction
Pay Pal	2.29% + $0.09 per transaction	2.9% + $0.30 per transaction

As you can see, Square's rates are competitive, especially for in-person transactions.

What Sets Square Apart in the Nonprofit Sector 

What sets Square apart in the nonprofit sector is its user-friendly interface coupled with powerful backend capabilities. 

The platform offers a range of features tailored to the unique needs of charitable organizations:

1. Donation processing: Accept one-time and recurring donations seamlessly.

2. Point-of-sale systems: Collect in-person donations at events or your organization's physical location.

3. Virtual terminal: Process donations over the phone or via mail.

4. Invoicing: Send professional invoices for pledges or sponsorships.

5. Reporting and analytics: Gain insights into your donation patterns and donor behavior.

How Square Benefits Nonprofits

As organizations increasingly focus on providing smooth, secure, and transparent donation experiences, Square's feature set proves to be a valuable asset.

Streamlined Donations

1. Online donation capabilities: Square enables nonprofits to accept donations through their websites effortlessly. With customizable donation forms and buttons, organizations can create a seamless giving experience for their supporters. The platform supports various payment methods, including credit cards, debit cards, and digital wallets, catering to donor preferences.

   
   

2. In-person donation options: For nonprofits that host events or have physical locations, Square's point-of-sale solutions shine. The Square Reader and Square Terminal allow organizations to accept donations on the spot, whether at a gala, charity run, or your office. This flexibility ensures you never miss an opportunity to collect a donation.

   
   

3. Mobile donation features: With the Square app, nonprofits can turn any smartphone or tablet into a mobile donation center. This feature is particularly useful for canvassing, community events, or any situation where mobility is key. Volunteers can easily collect donations on the go, expanding your fundraising reach.

   
   

Easy Set-Up Process

1. Quick account creation: Setting up a Square account for your nonprofit is remarkably straightforward. The process is designed to be intuitive, allowing you to start accepting donations rapidly. Most organizations can complete the initial setup in under an hour.

   
   

2. User-friendly interface: Square's dashboard is known for its clean, intuitive design. Even team members or volunteers with limited technical experience can navigate the platform with ease, reducing the learning curve and training time.

   
   

3. Minimal technical knowledge required: Unlike some competing platforms that may require extensive IT support, Square is designed for easy implementation. Most nonprofits can manage the setup and day-to-day operations without dedicated technical staff.

Transparency and Reporting

1. Real-time donation tracking: Square provides instant notifications for every donation received, allowing you to track your fundraising progress in real-time. This feature is particularly valuable during time-sensitive campaigns or matching gift periods.

   
   

2. Detailed financial reports: The platform offers comprehensive reporting tools that give you insights into your donation patterns, popular giving times, and donor preferences. These reports can be customized and exported, making it easier to share information with board members or use the data for strategic planning.

   
   

3. Data export capabilities for accounting purposes: Square integrates with many popular accounting software solutions, such as QuickBooks and Xero. This integration streamlines your financial processes, reducing manual data entry and the potential for errors.

   
   

By leveraging these benefits, your nonprofit can create a more efficient, donor-friendly giving experience while simultaneously gaining valuable insights to inform your fundraising strategies.

Best Practices for Using Square in Your Nonprofit

To maximize the benefits of Square for your organization, consider implementing these best practices:

Maximizing Online Donations

1. Optimizing donation page design:

   
   

   • Keep your donation form simple and easy to navigate.

   • Use compelling imagery and clear calls-to-action.

   • Offer suggested donation amounts alongside a custom option.

   • Ensure your donation page is mobile-responsive for on-the-go giving.

   
   

2. Leveraging social media integration:

   
   

   • Share your Square donation link across all social media platforms.

   • Create campaign-specific Square checkout links for targeted fundraising efforts.

   • Use Square's social media tools to track the performance of different channels.

     
     

3. Using email campaigns with Square donation links:

   
   

   • Embed Square donation buttons directly in your email newsletters.

   • Create urgency with time-limited Square checkout links for specific campaigns.

   • Use Square's analytics to segment donors and personalize future email appeals.

     
     

Event Fundraising with Square

1. Preparing for seamless donation collection at events:

   
   

   • Test all Square hardware before the event to ensure smooth operation.

   • Create event-specific items in your Square dashboard for easy tracking.

   • Set up multiple donation stations to reduce wait times.

   
   

2. Training volunteers on Square usage:

   
   

   • Conduct hands-on training sessions for volunteers using Square devices.

   • Create simple, step-by-step guides for quick reference during the event.

   • Assign a tech-savvy volunteer to troubleshoot any issues that may arise.

   
   

3. Post-event donation management and follow-up:

   
   

   • Reconcile all donations immediately after the event.

   • Use Square's reporting tools to analyze event performance.

   • Send personalized thank-you messages to event attendees using Square's data.

   
   

Donor Communication

1. Customizing receipts and thank-you messages:

   
   

   • Personalize Square receipts with your nonprofit's branding and mission statement.

   • Set up automatic thank-you emails for online donations.

   • Use Square's data to create targeted follow-up communications.

     
     

2. Using Square data for personalized donor outreach:

   
   

   • Segment donors based on giving history and preferences.

   • Create tailored appeals based on past donation amounts and frequency.

   • Use Square's analytics to identify and nurture potential major donors.

     
     

3. Maintaining donor privacy and data security:

   
   

   • Regularly review and update your Square account's security settings.

   • Train staff on best practices for handling donor information.

   • Be transparent about how you use and protect donor data collected through Square.

Conclusion

Embracing efficient and user-friendly payment solutions like Square can significantly enhance your nonprofit's fundraising capabilities.

The platform's ease of use, coupled with its robust reporting and integration capabilities, makes it an excellent choice for nonprofits of all sizes.

Remember, the key to success with Square lies not just in its implementation, but in how you leverage its features to engage with your donors and optimize your fundraising strategies.

I encourage you to take the next step in modernizing your nonprofit's financial operations.

If you need help deciding if Square is a good match for your nonprofit, visit jrpayments.com to schedule a free consultation.

I'll assess your needs, evaluate your current payment processing setup, and provide tailored recommendations to help you maximize donations while minimizing transaction fees.

Whether you're hosting events, managing online donations, or looking for recurring payment solutions, I’ll guide you through the best options for your nonprofit.