PayPal is a secure service for sending and receiving money via the Internet. Purchased by eBay in 2002 and integrated as eBay’s preferred billing solution, PayPal has continued to grow ever since. There are currently over 220 million PayPal account holders worldwide in approximately 190 countries and territories[1]. Canada represents the third largest market for PayPal after the US and UK. In addition, 2 out of 3 online shoppers have a PayPal account, which represents more than 9 million Canadians. This Canadian PayPal populace purchases more than $2.4 billion online annually via PayPal and the rate of PayPal sales is growing at twice the rate of all Canadian eCommerce sales.[2]
PayPal is starting to focus on Canadian not-for-profit organizations as candidates for offering the PayPal payment method option on their eCommerce sites. Currently, few Canadian not-for-profits are using PayPal. However, the use of this payment method is being adopted by US not-for-profit organizations in increasing numbers. During 2009 over 100,000 not-for-profit organizations processed a total of $1.2 billion USD online via PayPal.[3]
Setting up a PayPal merchant account can provide benefits to both your donors and your organization alike. Reasons include[4]:
- Security – Offering PayPal as a payment option allows donors to make purchases without ever entering their payment information into your online solution. All payments are processed within PayPal’s secure environment.
- Fast and Easy – The PayPal payment method seamlessly integrates into the online check-out experience. When it is selected as the payment method, the user is prompted to log into their PayPal account on a PayPal hosted page and then they confirm the transaction and are forwarded back to your eCommerce or donation thank-you page.
- Choice – Providing customers with another payment method choice adds convenience to their online purchasing experience.
- Found Money – PayPal users often have excess balances sitting in their PayPal accounts that they consider “found” money. What better way to put that excess money to use than by using it to make charitable donations.
Over the next several months Cornerstone Fundraising Services will be working on integrating PayPal as a payment option into our donation processing and eStore products. Artez Interactive already offers this payment option on its software. Despite the additional fees involved, depending on your organization’s eCommerce transaction volumes, if the US trends play out in the Canadian marketplace it may be a payment method worth exploring.
Do you have any experiences to share related to the implementation of PayPal as a payment method option? Any thoughts on its Canadian market potential for not-for-profits? I’d be interested in hearing from you.
Heather Campbell, Account Director – Online, Cornerstone Fundraising Services
[1] As per PayPal web site – https://personal.paypal.com/ca/cgi-bin/marketingweb?cmd=_render-content&content_ID=marketing_ca/what_is_paypal&nav=0.0.0
[2] “Introducing PayPal” presented by Jolie McMillian, Director Strategic Partnerships – PayPal – April 2010
[3] “Introducing PayPal” presented by Jolie McMillian, Director Strategic Partnerships – PayPal – April 2010
[4] “Introducing PayPal” presented by Jolie McMillian, Director Strategic Partnerships – PayPal – April 2010
