Lots of people start out looking for no-fee crowdfunding, wanting to keep as much as possible of the funds they raise. But most commercial crowdfunding sites charge a fee. Is there any way around this? The short answer is: not really. Almost all platforms charge a fee of some kind, but there are a handful of cheaper or (occasionally!) no-fee options.

But remember, those charges are what make the enormous reach of these crowdfunding platforms possible. So do your research and decide what trade-offs you want to make. If you’re fundraising for a known group (like a PTA) then you probably already have contact details for all your donors, and you just want somewhere to centralise their donations – so you don’t need to worry about bringing in new audiences. But if you’re crowdfunding for something bigger and you can’t personally contact everyone, it may matter more to have a crowdfunding platform with national or global reach. It’s also likely to matter to your donors when it comes to handing over their card details that it’s a site – and brand – they already trust.

Types of fees

One thing to cover first: there are three types of fees we can talk about here. First of all, there are platform fees – these are usually charged as an overall percentage of the total you raise. So if there’s a platform fee of 5% and you raise £1000, you’ll be charged £50 as the platform fee. Next, there are transaction or payment processing fees. These apply to each transaction, and often reflect the charges passed on to crowdfunding platforms by the bank or card issuer – sometimes they’re a percentage, sometimes a flat fee (like 50p per transaction) and sometimes a combination of both. Finally, there are one-off fees – occasionally some platforms also charge a sign-up fee.

If you’re a charity

If you’re a registered charity with the Charity Commission, then there are some options for free or low-fee crowdfunding campaigns. You can look at platforms dedicated to charities like JustGiving (5% service fee plus payment processing fees, and monthly fees), Virgin Money Giving (2% service fee plus payment processing fees, and one-off sign-up fee), Givey (5% fee – but charged directly to donors, not charities). Most offer donors the option to cover those fees at the point of donation.

There are also a couple of non-charity-specific platforms that offer a no-fee crowdfunding option for charities – GoFundMe (transaction fees still apply), and Crowdfunder. In the case of Crowdfunder, they have a standard charity model of 3% fees plus payment processing fees, but right now they’re also helping charities who are fundraising in response to Coronavirus, by offering 100% free crowdfunding and support as part of their Pay It Forward campaign.

If you’re a private individual

If you’re a private individual raising money for your own personal costs (education, medical care, other emergencies) then you’ve still got choices. The big name is GoFundMe again, with only transaction fees. But as a private individual you might not want to be as public as that about how much you’ve raised – you could also look into taking PayPal donations (no fee when sent as Friends and Family, in the same currency) or setting up a Ko-Fi (no platform fees; transactions go via PayPal so there’s a transaction fee).

If you’re another kind of organisation

If you’re not a charity, and not a private individual, you’re pretty much out of luck when it comes to no-fee crowdfunding – with the exception of Crowdfunder’s Pay It Forward campaign, aimed at supporting all kinds of organisations (small businesses, community groups, campaign groups).

But, if you could get the same reach, visibility, excitement, and urgency as a crowdfunding campaign just by asking for payments direct to your bank account… you’d already be doing that. Crowdfunding platforms generally charge a fee, but they’re also providing you with a service. As long as you research what the fees are ahead of time, you can make an informed choice.

Want a bit of guidance on choosing a platform? I’m a crowdfunding consultant and I’d be happy to help – get in touch here.