Facebook Fundraiser Feature
Challenges on Facebook: What, Why, and How for Nonprofits
February 3, 2022
When it comes to payment processing for digital donations, even the most experienced nonprofit professionals can get confused. With all of the steps happening out-of-sight, it can seem like the funding appears out of nowhere.
This uncertainty can be incredibly inconvenient for nonprofits that depend on digital donations. When you don’t know how funds are processed, when they’ll be delivered, and how much will be deducted from them due to processing fees, it’s difficult to plan for future efforts.
This is especially true for Facebook fundraising, which has not one but four different payout methods for nonprofits.
At GoodUnited, we have dedicated time and resources to researching and optimizing Facebook Challenges for nonprofits just like yours. While doing so, we’ve familiarized ourselves with the payout process and strive to help organizations understand exactly what goes on behind the scenes.
We’ve broken the key questions surrounding the Facebook fundraising payout process into the following points:
One of the many mysteries surrounding Facebook fundraising is how nonprofits like yours actually receive the funds intended. Use the navigation above to jump to the sections that pique your interest, or continue reading from the top to demystify the process.
To understand Facebook fundraiser payout, you first need to understand the channels that Facebook uses to process donations.
There are four channels used to facilitate Facebook fundraiser and Challenge payout. These channels are:
As far as which channel will process donations to your nonprofit, that depends on two things: whether you register directly with Facebook’s fundraising tools and where your nonprofit is located.
Your nonprofit has the choice to register directly with Facebook Payments or be opted-in to the alternative channel offered in your location.
There are key differences between how payments are processed with each method, so it’s important to conduct research for your organization and opt-in to the channel that best fits your needs. For example, while Facebook Payments operates on a bi-weekly timeline, Network and PayPal have a payout timeline ranging anywhere from 15 to 90 days. And, while Payments has the potential to provide donor information as well as fundraiser information, the other channels do not.
The graphic below outlines the differences between each channel in more detail:
For more information about these payout methods and where they differ, check out this page in the Facebook Help Center.
For the purposes of this guide, we’re going to take a deep-dive on two of these payout paths: Network for Good and Facebook Payments. This is because Network for Good and Facebook Payments are the payout methods available to nonprofits in the U.S. and, in the case of Payments, the channel we recommend your organization register with.
Now that we’ve covered the basics of each payout method, let’s look closer at payment processing through Facebook Payments and Network for Good.
Both processes start the same:
However, this is where the two processes diverge.
Facebook Payments is a direct payout system. This means:
On the other hand, Network for Good is a donor-advised fund (DAF). A DAF is a specialized type of philanthropic savings account in which donations are placed, left to accrue interest, and then eventually directed to the nonprofit they’re intended for. Because of this, the payout process is slightly different:
In total, donation processing via Network for Good can take anywhere from 45-75 days. For nonprofits looking to raise funds through Facebook quickly, this extended timeline can make a huge difference.
While both Network and Payments will deliver funding safely to your nonprofit, we recommend nonprofits align directly with Facebook fundraising by signing up for Payments.
There are a few different reasons why we recommend this route:
When you register directly with Facebook Payments, you not only receive funding faster— but you also have the opportunity to access valuable donor information. At GoodUnited, we’ve found information just like that to be game-changing for nonprofits looking to increase donations to their organization, something you’ll read more about later in this piece.
Now that we’ve discussed the two main payout paths your nonprofit might encounter with Facebook fundraising, let’s look at how you can align your organization with these paths to ensure you receive your funding in a timely manner.
First, a brief discussion of Network for Good. Technically, your nonprofit doesn’t need to register with Network to receive funding through this channel— that’s why you may have already received Facebook fundraiser donations without conducting research about the process before. However, we highly recommend registering directly with Network if you plan to use this payout method.
Network uses GuideStar to match donations to unregistered organizations. So, if your GuideStar profile is outdated, Network could end up sending the funding to the wrong location. Even further, that check will be physically mailed which can leave additional room for error. If you register directly with Network, you can verify the account you’d like funds direct deposited into and avoid these speedbumps.
That said, we want to dedicate additional space in this article to discuss signing up for Facebook Payments, as that’s our recommended payout method.
As a recap, we recommend signing up for payments because it’s the fastest payout method in North America and it has the potential of providing donor information. But, there are a few steps your nonprofit needs to take to sign up with Facebook Payments:
After completing these steps, your nonprofit will be notified of approval within two to three weeks. Then, you can begin receiving donations from Facebook fundraisers and Challenges and access Facebook’s fundraising tools, such as the donation button.
With that covered, let’s discuss a few frequently asked questions regarding Facebook fundraiser payout.
The timeline of Facebook fundraising payout can vary greatly depending on the payout channel you’re working with. This is one reason why it’s crucial to research the various payout methods— if timeliness is imperative for your organization, that might affect your choice.
There are a few aspects to consider beyond simply aligning with the payout channel that has the ideal timeline for your team. For instance, the payout process doesn’t begin until your nonprofit reaches the minimum raise amount, $100. So, one way you can speed up payout is simply by empowering fundraisers started on behalf of your organization to raise more funds, faster.
If you’re seeking the fastest possible payout, this is what we’d recommend:
That said, ultimately your nonprofit won’t need to worry about quick payout if that minimum fundraising threshold is never met.
As of 2017, there are no fees associated with processing Facebook fundraising donations through any of the payout channels.
While there are costs associated with the administrative and payment processing tasks, Facebook covers these fees for all fundraisers held on behalf of accredited nonprofit organizations.
This was brought on by a landmark petition, in which a nonprofit and its supporters asked the platform to waive fundraising fees during a time of need. To learn more about this history, check out GoodUnited’s guide to Facebook fundraiser fees.
This makes Facebook one of the few online fundraising methods with no processing fees. Meanwhile, the peer-to-peer platform, online giving page, and crowdfunding platform you’ve used in the past likely take anywhere from 3% - 6% from every donation to cover processing fees.
Details like this are why Facebook fundraising is such a crucial fundraising channel for nonprofits like yours to optimize.
Facebook fundraiser payout is handled through a variety of channels, three of which are external channels separate from the Facebook platform itself. Because of this, your organization can’t simply process a refund and return gifts made to donors on your own.
There are a variety of reasons why a donor might seek a refund. They may have accidentally made too large a donation, contributed by accident, or simply may have changed their minds. Regardless of the reasoning, the donor’s next step is to contact Facebook directly with the refund request.
It follows then, that your nonprofit should handle requests for refunds by directing the donor to Facebook’s help center.
Donations don’t magically appear on Facebook to be transferred to your nonprofit. The donations come from donors who are moved to support your cause. So, to increase your Facebook fundraiser payout, you need to go straight to the source— the fundraisers and the donors who give to them.
At GoodUnited, we specialize in helping nonprofits just like yours optimize Facebook fundraisers to raise more donations and build long-lasting relationships with social media supporters. Here are a few stand-out tips we’ve discovered to increase the donations raised on your behalf:
These are just a few of the many ways we’ve found that nonprofits can interact with fundraisers and elevate them to raise more. At GoodUnited, we help nonprofits do all of the above and more. For help increasing your nonprofit’s Facebook fundraising potential, contact us today.
To learn more about Facebook fundraising and optimizing the process for your nonprofit, explore the following additional resources:
