4 Things to Know About Meta’s Oct. 31 Switch to PayPal Giving Fund for Donation Payouts
Meta announced a new partnership with PayPal Giving Fund over the summer, but there are ramifications for nonprofits that don’t agree to Meta’s new terms and the new payment provider.
In order to continue receiving donations from Meta platforms, including Facebook and Instagram, nonprofits using Meta’s fundraising tools have until 5 p.m. Pacific Time on Oct. 31 to comply. Here are four changes that your nonprofit should know if it plans to continue using Facebook and Instagram to fundraise for year end.
1. All Nonprofits Must Accept New Meta Donation Terms
Meta will no longer allow nonprofits to dispense funds via Meta Payments or Network for Good after Oct. 31. If your nonprofit is currently using either of these to process donation payouts on Meta properties, you must accept Meta’s new Charitable Donation Terms by 5 p.m. Pacific Time on Oct. 31.
If your organization misses the deadline, it may lose access to some Facebook fundraising tools, the company said.
2. Nonprofits Must Now Process Payouts With PayPal Giving Fund
Meta’s move sunsets both Meta Payments and Network for Good in the U.S. on Oct. 31 regardless of whether the nonprofit has accepted the new terms. This applies to fundraisers, as well as page and post donate buttons.
Your previous payment processor will be responsible for donations made prior to Sept. 15, as well as those given via donate buttons and to fundraisers created prior to nonprofits agreeing to the new terms.
If your organization accepted the terms by 4 p.m. Pacific Time on Sept. 15, the change will take effect with the exception of fundraisers and posts with donate buttons created before that date. Those will shift to PayPal Giving Fund at 5 p.m. Pacific Time on Oct. 31. If the new terms have not been selected by the latter date and time, active fundraisers and posts with donate buttons will automatically be disabled.
PayPal Giving Fund payments will be distributed within 15 to 45 days to enrolled organizations. Those nonprofits that are not enrolled will receive funds via check in 90 days.
Facebook donors will recommend a charity to which they wish to donate, and PayPal Giving Fund, which is a donor-advised fund, will grant that money in accordance with its policies. Meta began using PayPal Giving Fund previously in Australia, Canada and the United Kingdom.
3. All Recurring Donations and Campaigns Will Be Suspended
Your organization’s previous processor will also be responsible for all recurring donations.
However, Sept. 14 was the final day to set up a recurring donation or campaign. Under the new partnership, new recurring donations and campaigns are no longer supported, but payments from existing donations and campaigns will be processed and paid via Meta Payments or Network for Good by 5 p.m. Pacific Time on Oct. 31. At that time, all recurring donations and campaigns will end.
Meta previously held campaigns to encourage donors to set up recurring donations.
“We know how important recurring donations are to nonprofits, and we hope to bring this feature back in the future,” the company wrote in a blog post announcing the move.
4. Meta Will No Longer Cover Processing Fees
Meta has been covering processing fees for nearly six years. However, it will no longer cover processing fees on donations on Facebook and Instagram as of 5 p.m. Pacific Time on Oct. 31. At that time, nonprofits will be subject to PayPal Giving Fund’s payment processing fee.
That rate is 1.99% plus a fixed $0.49 fee for domestic transactions. Additional fees apply for international donations.
“We understand this is a big change, and to assist in the transition, Meta is also changing the donation flow to give donors the option to increase their donation amount to cover processing fees,” the company wrote in a blog post announcing the move.
Other Changes to Note
In addition to these four changes, here are a handful of other important adjustments to know.
- Transaction reports. Meta will no longer provide tax documentation. Instead PayPal Giving Fund will provide enrolled nonprofits with donation activity reports. Meta will, however, continue to provide a limited transaction report in Nonprofit Manager.
- Donation receipts. Meta also will cease sending official donation receipts for tax purposes, only confirmations of donations. PayPal Giving Fund will also take on that responsibility.
- Facebook donation ads. Ads set up before switching to PayPal Giving Fund will stop delivering on Oct. 31 and need to be set up again.
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