The pitch is appealing on the surface. A donation platform that costs your nonprofit nothing. No monthly fee. No per-transaction fee. Just sign up and start raising money.
But software companies do not run on goodwill. Every donation platform has to make money somewhere, and when the answer is not “the nonprofit,” it is almost always “the donor.”
That tradeoff has a name in the industry. It is called donor tipping, and it is changing what your donors see at checkout in ways that often work against your mission.
What Donor Tipping Actually Looks Like
Imagine someone visits your donation page and decides to give $100 to your nonprofit. They enter their card. Then, just before they complete the gift, the platform asks them a question:
Donate $100 to [Your Nonprofit]
Add a tip to support our platform: 15% ($15.00) (default selected). Other options: 10%, 20%, Custom, No tip.
Your donor came to give your organization $100. The platform now asks them to give $115. The default is selected for them. To remove it, they have to actively choose “No tip,” which often requires an extra click and reads, to a first-time donor, like opting out of supporting a charity.
Multiply that interaction across every donation, every campaign, every event. The friction adds up fast.
Why “Free” Platforms Use Donor Tipping
The math is simple. A donation platform has real costs: payment processing, hosting, support, fraud prevention, compliance, engineering. Someone has to pay for all of it.
Platforms that charge your nonprofit a flat monthly fee or a transaction fee fund those costs from your subscription. Platforms that advertise themselves as “free” or “0%” to nonprofits fund those costs by asking your donors to chip in, gift by gift.
Neither model is inherently wrong. But they produce very different experiences at checkout, and that difference matters more than most nonprofits realize when they are choosing a platform.
The problem is not that platforms need to make money. The problem is that the donor often does not know the tip is for the platform until they are already at checkout, and the prompt is structured to nudge them toward saying yes.
The Hidden Costs to Your Nonprofit
On paper, donor tipping looks like a free lunch for your organization. In practice, it costs you in four ways that rarely show up on a comparison chart.
1. First-time donors get confused
If a donor has never given to your nonprofit before, the tip prompt is the first thing they associate with your brand. They may not know the difference between “tip the platform” and “tip the charity.” Some assume the tip goes to your organization. Some find it tacky. Some just close the tab.
This is the donors you need most, the ones acquiring for the first time, taking the worst version of your checkout.
2. Your conversion rate drops
Every additional decision in a checkout flow costs you donors. The classic checkout optimization research from e-commerce shows that adding even one extra step or one extra prompt reduces completion rates measurably. A tip prompt is exactly that kind of friction. Some donors will stop and think. Some will second-guess giving at all. Some will give a smaller amount than they originally intended because they feel pressured to also tip.
The donations you never see, because the donor closed the page, do not show up in any platform’s reporting. They just become missing revenue.
3. Your team spends time explaining the tip
When confused donors do reach out, they almost always email your nonprofit, not the platform. Your staff or volunteers end up answering questions like:
- “What is the tip for?”
- “Did my $115 all go to your organization?”
- “Why are you taking 15 percent on top of my donation?”
Each of those emails takes time to handle correctly. Each one is a small but real hit to your team’s capacity, and to the donor’s impression of your brand.
4. Your brand absorbs the friction
The platform’s logo is small on the donation page. Your nonprofit’s logo is large. When a donor has a confusing or pushy checkout experience, they associate it with you, not the platform vendor. Even if the platform is technically responsible, the brand cost lands on your organization.
For nonprofits that depend on long-term donor relationships, this is the kind of cost that compounds slowly and is hard to undo.
The Real Math of “Free”
It is worth running the numbers honestly. Compare two scenarios for an organization that processes $200,000 in donations per year.
| Scenario | Platform Cost to Nonprofit | Donor Friction | Estimated Lost Donors |
|---|---|---|---|
| “Free” platform with donor tip prompt | $0 | Tip prompt at every checkout | 5 to 10% of completions |
| Flat monthly fee, no tip prompt | $240 to $600 per year | None at checkout | Baseline |
If even 5 percent of would-be donors abandon a $200,000-per-year donation flow because of tip-prompt friction, that is $10,000 in lost gifts. A flat platform fee of $240 to $600 per year pays for itself many times over before you have even counted improvements to repeat giving and donor trust.
And those are conservative numbers. The real impact on first-time donor conversion is usually larger than the line item on a pricing page.
What to Look For in a Donation Platform
If you are evaluating a new platform, or rethinking the one you have, here are the questions worth asking before you commit.
Does the platform prompt my donors to tip?
Ask directly. Not “does it cost me anything,” but “what does my donor see at checkout.” If a tip prompt appears at any point, you are using donor tipping, no matter how the platform brands itself.
Is the tip default-selected?
A tip prompt with no default is far less harmful than one where 15 percent is pre-selected. Pre-selected defaults are designed to nudge donors into saying yes by making it harder to say no.
What is the platform’s revenue model?
If the answer is “we are 100% free for nonprofits,” the next question is “then where does your revenue come from.” Every platform has a revenue model. Transparency about it is a good sign.
Can I see the donor checkout experience before committing?
Ask for a demo of the donor side, not just the admin side. Walk through a real donation flow on a phone. Note every prompt, default, and field. The donor experience is the only thing that affects conversion.
How CoreCause Approaches This
The tradeoff is intentional. CoreCause charges nonprofits a predictable monthly fee instead of shifting the cost to donors at the moment of giving. That keeps the donation page simple, the donor experience clean, and the brand cost off your organization.
Pricing is published openly on the CoreCause pricing page. There is no donor tip prompt to add, remove, customize, or explain to confused donors after the fact.
For nonprofits that want donors to have the option of covering processing fees, the Platform Fee Offset is available as a small, clearly labeled checkbox at checkout. It is opt-in. It is never selected for the donor by default. And it never asks for a percentage of the gift itself, only the actual processing cost.
The Bottom Line
“Free” in software almost always means somebody else is paying. With donor tipping, that somebody is your donor, at the exact moment you most need them to feel good about giving.
For most nonprofits, the predictable cost of a flat platform fee is significantly cheaper than the unpredictable cost of donor friction, lost first-time gifts, and the time spent explaining tip prompts to confused supporters.
If you are unsure what your current platform is doing at checkout, the fastest way to find out is to test it yourself. Open your donation page in an incognito window, on a phone, and walk through giving $50 like a first-time donor. What you see in those last 30 seconds is what every new donor sees.
That is the experience you are trusting to grow your fundraising.