Third Party Aggregator Giving & Processing Fees

John Geoffrion

We have a large number of donors who contribute through a third party - a workplace giving vendor like Benevity or Cybergrants, or via the United Way, or any number of charity processors, etc - and in many cases these aggregators deduct a processing fee.


For example: Jane Smith gives us a $100.00 donation via payroll deduction through a third party, who then deducts a $3.50 processing fee, and we end up with a check (or ACH) from the third party for $96.50.


So what do we enter for a gift amount? $100.00 or $96.50?


The part of me who wants to please the donor says $100.00, because that's what the donor intends to give and that's what the donor would want on their acknowledgement letter. (in most cases, they get a tax letter from the aggregator, so we don't have to worry about tax benefits.)


The part of me who wants to cleanly reconcile with accounting says $96.50 because that's what's going into the bank.


Thoughts?

JoAnn Strommen

I think most donors today are savvy enough to know that there are processing fees on just about everything.  And as you said, in most cases they are being receipted by the vendor. 

So I would vote for entering the received amount to align with accounting as you said.   If you are questioned by the donor as they don't like that you didn't get the full amount, you can suggest they make their donation directly to your org. 

Angela Tuttle

We enter as a $100 gift in RE. Then in the FE batch we add lines to charge the fee to an expense account. 

Crystal Bruce

Hey John,


Is this a product related question - can I move it to a different forum for you? Raiser's Edge? If you let me know the product, I can move it. Thanks!

Joanne Felci

We give the donor credit for the full donation and separate out the fees on what we send to finance.