The Monthly Donor Lockup Problem: When Platforms Hold your Donor Data Hostage

In this episode of the Whole Whale podcast, host George Weiner speaks with Sal Alpietro, Chief Community Officer at Fundraise Up, about a critical issue affecting nonprofits: the ownership and transfer of payment tokens for monthly donors. Sal shares alarming stories of nonprofits facing exorbitant fees and resistance when trying to move donor data between platforms. They discuss the importance of asking the right questions before signing contracts with donation platforms and the potential financial and operational risks of not doing so. Sal also shares advice on best practices and offers insights into recent developments at Fundraise Up.

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If your nonprofit does not own the payments portal account (IE Stripe, Braintree, Paypal) and it has monthly donors, then it may not actually “own” those donors.

While standard donation platform contracts allow for donor contact information to be exported, they may not allow the Donor Payment Tokens that allow for ongoing monthly donations to be exported. This means your nonprofit would lose the ability to continue to charge monthly donations from donors that had opted-in to donate if you moved platforms. Donation platforms range from small to huge fees to export this data, while some block this ability all together.

• Here is a great LinkedIn explanation of this
• Here is information going back to 2018 from the Agitator calling out this monthly donor lockup issue.

 

“I have seen nonprofits literally in tears when they were told they needed to payup $30k to get permission to migrate their monthly donorbase built over years.”
 Salvatore Salpietro, Chief Community Officer, Fundraise Up

 

 

Full article on the Monthly Donor lockup problem.