Nonprofit Payment Processing Built for Your Mission
- Wade Tetsuka
- Aug 19
- 5 min read
If you work in the nonprofit world, you’ve probably been told that nonprofit payment processing is “simple.” After all, it’s just donations or membership dues, right?
That’s what the sales reps say—right before offering you a one-size-fits-all platform designed for retail stores.
The truth is, nonprofit revenue is anything but simple. Between member dues, grants, event registrations, recurring donations, education, and sponsorships, it’s a hybrid beast that deserves smarter tools.
I’ve spent years helping nonprofits make payment systems work for them—not the other way around. And it starts with shifting how we think about payments: not as a necessary evil, but as a strategic enabler.
The Invisible Burden of Payments on Nonprofits
Nonprofits aren’t exempt from payment processing headaches. If anything, they feel them more acutely.
Most systems aren’t built for donation models, restricted grants, or dues structures. That leads to clunky manual workarounds, patchwork reporting, and reconciliation delays. When teams are already stretched thin, chasing down mismatched entries can quietly drain resources.
And that inefficiency doesn’t just cost time—it costs revenue.
According to Double the Donation, revenue from one-time online giving dropped by 12%, while monthly giving increased by 11% and now accounts for 28% of all online donations.
The takeaway?
Donors are shifting toward sustained giving—and systems that can’t support that shift risk leaving revenue on the table.
What Are the Best Payment Processing Options for Nonprofit Organizations?
“Best” doesn’t mean flashiest or cheapest—it means fit for purpose. Nonprofit payment platforms need to be designed around:
Recurring giving and member dues
Fee transparency and routing
The ability to pass on processing fees to donors or members in a compliant and legal way
Integration with their accounting software
Personalized support and guidance
Common pitfalls of retail-oriented platforms:
Limited (or non-existent) support for nonprofit revenue models like recurring donations, dues, and events
No tools to pass on fees through compliant surcharging, dual pricing, or convenience fees
Inflexible pricing structures that quietly raise costs
Lack of integration with nonprofit financial systems, increasing manual effort
Generic reporting doesn’t reflect donation types or grant requirements
Support teams unfamiliar with nonprofit operations
Retail platforms may be good at selling t-shirts—but when it comes to fundraising, fund accounting, and donor trust?
That’s a different story.
What Does ‘Custom’ Really Mean in Nonprofit Payment Processing?
“Custom” isn’t about bells, whistles, or complexity—it’s about alignment.
Nonprofit organizations often manage multiple revenue streams at once: donations, membership renewals, event fees, sponsorships, and restricted grants.
A custom-configured system—or better yet, integrated payment solutions for nonprofits—ensures each stream flows into the right account, syncs with the right records, and stays compliant.
It also means giving nonprofits choice—not locking them into one gateway or payment model.
That’s why we support “Bring Your Own Processor” (BYOP) configurations that allow organizations to choose a payment gateway that is best suited to their activities, and to maintain flexibility without losing oversight.
And it pays off.
According to Nonprofit Tech for Good, 31% of online revenue now comes from monthly giving, and recurring donors give 42% more than one-time donors.
How Can Payment Systems Be Customized for Nonprofit Workflows Like Recurring Donations and Membership Dues?
I get this question a lot. Let’s break it down:
Recurring giving: Automatically charge monthly donors, allocate to the right fund, and issue receipts—without staff intervention.
Membership dues: Tie renewal payments to membership status, and automate reminder emails.
Event-based payments: Allow variable pricing (early bird, group, comped tickets), and sync registrations with your CRM.
Grants or sponsorships: Track payments by funding source to ensure compliance with use restrictions.
Retail platforms weren’t built for any of the above. Custom systems reduce friction, and they don’t have to be complicated.
Done right, custom means simpler, not harder.
How Does Integrating Payment Processing with Dynamics 365 Business Central Benefit Nonprofits?
Integrating credit card payment processing for nonprofits with Dynamics 365 Business Central eliminates manual entry, reduces errors, and improves financial visibility—freeing up time for more strategic work.
With integration:
Payments post automatically to the general ledger.
Donation records sync with contact data.
Reconciliation happens in real time.
You gain clarity and control.
Even better, modern platforms are secure and scalable. I break this down in this post on Open Modern Payment Platforms, including how they support growth across revenue channels.
According to Discover Global Network, 85% of nonprofit donations are made via credit or debit card, and digital-first nonprofits grow 12.7% faster than their counterparts.
Make no mistake: Integration is no longer a nice-to-have.
How Can Nonprofits Reduce Credit Card Processing Fees Without Sacrificing Service?
It starts with understanding the pricing models:
Flat rate: Simple but often more expensive
Interchange+: More transparent, but needs proper configuration
Level III data: Reduces fees on qualified transactions
Charity rates: Visa, Mastercard, and AMEX all offer lower interchange rates for qualified nonprofits—but you only get them if your processor files the paperwork
It's shocking how many organizations overpay simply because no one ensured they were classified correctly.
You can also configure systems to pass fees along legally—many donors are happy to help.
Bottom line?
Smarter systems + smarter setup = less waste and more mission.
Why Is Personal Service Important When Choosing a Nonprofit Payment Provider?
When a payment fails or a reconciliation doesn’t balance, the last thing a nonprofit wants is a chatbot or a help desk ticket.
Nonprofits need support teams who understand their structure, urgency, and funding cycles. A dedicated point of contact ensures that small issues don’t become big headaches.
Unfortunately, many nonprofits are also overpaying because no one ever reviewed their processing setup or advocated for lower rates. Your payment partner should be doing both.
Payments as a Strategic Enabler (Not Just a Cost Center)
It’s time to stop treating payments as background noise.
When properly aligned, payment systems can:
Build donor trust
Support operational transparency
Improve long-term sustainability
This isn’t about chasing the newest tech. It’s about creating clarity, control, and confidence—so your team can focus on impact.
The Right Tools for the Right Mission
I’ve helped nonprofits redesign their payment systems without overengineering them. Often, the biggest wins come from small changes: smarter routing, clearer reporting, and support that actually... supports.
Payment processing for nonprofits doesn’t need to be complicated—but it does need to be intentional. When you align technology with your mission, every dollar, donor, and decision works harder for the cause.
Ready to rethink your approach? Contact USTPay for a consultation.
About Wade Tetsuka:
Wade Tetsuka is a visionary leader with over 15 years of experience as President of U.S. Transactions Corporation, where he has helped transform the landscape of B2B merchant services.
His deep expertise in finance, coupled with a keen understanding of compliance and client management, has positioned UST–a leading Fintech company and Independent Software Vendor (ISV) for Microsoft Dynamics 365–as a trailblazer in helping businesses save money and streamline payment processes.
As the founder of Presidential Forum LLC, an exclusive network for C-level executives, Wade fosters thought-provoking discussions that shape industry trends and leadership strategies. His commitment to excellence and forward-thinking approach makes him a sought-after voice in both the Fintech and executive leadership arenas.
Connect with Wade on LinkedIn.
