Are 'free' fundraising platforms really free?
Understanding the hidden costs behind fundraising platforms that advertise as 'no fee' or use 'optional tips' for donors.
Rates and models described here were checked in August 2026. Platform pricing changes — always confirm directly before making a decision.
If you have compared online giving platforms recently, you will have seen a lot of zeros. 0% platform fee. 0% transaction fee. Keep 100% of what you raise.
It is worth looking into these claims, because no online giving platform is truly free to run. Payment processing, hosting, security certification, fraud monitoring, receipting, and human support all cost money. The question is never whether those costs exist. It is who ends up paying them, and how openly the platform tells you.
Every online donation passes through at least three layers of cost:
- Payment processing: The card networks, the acquiring bank, and the payment gateway.
- The platform: Feature development, bug fixing, hosting, compliance, fraud monitoring, and disbursing funds to your bank account.
- Administration: Customer support and education.
Advertising a 0% platform fee does not remove any of these. It relocates them.
The two ways 'free' platforms recover their costs
1. Passing payment processing fees to your organisation
Most 'no-fee' platforms still charge payment processing fees, but usually through an international partner such as Stripe, PayPal, or Braintree. So while the platform charges no transaction fee, the fee still exists, and organisations will need to connect and configure the payment gateway themselves. The most common rate is between 1.4% and 2.2%, sometimes plus a fixed fee of around 30 cents per transaction.
For comparison, GiveNow works with an Australian payment partner rather than an international gateway. Visa and Mastercard donations to DGR-endorsed organisations are charged at 0.26%, non-DGR organisations at 0.99%, and direct debit costs nothing. There is no fixed per-transaction cost.
These rates are much lower than the international providers, and all customer data is stored locally in Australia.
2. Charging your donors an 'optional' tip
The second approach shifts the cost from your organisation to your supporters. At checkout, the donor is asked to add a tip or contribution to the platform on top of their gift.
The word 'optional' is doing a lot of work here. On most platforms using this model, the tip is pre-selected rather than opted into, which means the donor has to notice it and actively move it to zero.
On many platforms, the pre-selected tip is defaulted to between 10% and 20%. GoFundMe's tipping slider, for example, has been widely documented as defaulting to around 15% — a substantial increase on the 5% platform fee they previously charged.
The consequences fall on your organisation, not the platform. ABC News has featured a story on a family who gave $2,000 to a relative's fundraiser and were startled to find $330 added to their bill as a platform tip. Commentary in The NonProfit Times has argued the model shifts an operating cost onto donors in a way that undermines trust in the sector generally.
When a donor is shocked by a charge, their trust in your organisation is damaged. It undermines your reputation, your donor relationship, and your future donation income.
The tax deductibility catch
The part that is often missed entirely, and that matters most for DGR-endorsed organisations, is tax deductibility.
Under ATO rules, a tax-deductible gift must be a voluntary transfer of money to a deductible gift recipient, with no material benefit received in return. The ATO is explicit that donations made to social media or crowdfunding platforms are generally not deductible unless the platform itself is a registered DGR.
A platform tip is a payment to the platform for a service. It is not a gift to your organisation. So a donor who gives $100 and leaves a pre-selected 15% tip pays $115, but only the $100 portion is generally tax-deductible. The extra $15 is generally not deductible.
On GiveNow, when a donor chooses to cover the platform fee (1.5%–3.5% depending on the organisation's choice of plan), that amount is added to the donation total and forms part of the gift to your organisation.
GiveNow's cover platform fee vs donor tips
Apart from having a much lower transaction fee, there are three key differences between GiveNow's platform fee and donor tips on other platforms.
- Size: GiveNow's platform fee is 1.5% to 3.5% depending on your plan. Pre-set tips on other platforms commonly start at 10% and have been documented as high as 20%.
- Destination: A tip is a payment to the platform, sitting outside the gift. A covered platform fee is added to the donation total and forms part of the gift to your organisation — which is why it is receiptable where you hold DGR status.
- Presentation: The donor sees a specific dollar figure that is clear and obvious, rather than a slider set to a percentage they have to notice and drag down. Your organisation also controls whether the prompt to cover platform fees appears at all, cause by cause.
Why we have stayed with this model
GiveNow launched in 2001 and is an enterprise of Our Community, an Australian social enterprise. In more than two decades we have remained the lowest fee provider — we have never charged a sign-up fee, a subscription, a lock-in contract, or a penalty fee. Our team, our payment processing, and our data storage are all in Australia.
Being upfront about our costs means our marketing copy is not always the most attractive. 'A small platform fee plus a low transaction fee' will always read as more complicated than 'free.' But thousands of Australian not-for-profits have chosen us anyway, because we are:
The most experienced
Founded in 2001, we are Australia's first online fundraising platform. We have been around for a while, and we will continue to serve the community sector for a long, long time.
100% local and secure
All of our team are based in Australia, and all data is stored locally in Australia. We support Australian not-for-profits only. We have never had a security breach since the day we were founded.
Lowest fees
Our fees (platform and transaction) are the lowest in Australia. There are no sign-up, subscription, or onboarding fees, and no fixed fee per transaction. Donors can choose to cover the platform fee, and 80% of the time they do.
Community at heart
As an Our Community social enterprise, we stand by the mission to build stronger communities through stronger community organisations. We approach every interaction with our members and customers with goodwill and assume others will do the same.
Simple and easy to use
Most of our customers are small to medium-sized community organisations, and our platform is designed to be simple and easy to use with no technical expertise required.
Comprehensive support
We offer 100% human support for our customers, including phone calls, emails, weekly group demo and onboarding sessions, one-on-one Zoom support sessions, monthly fundraising newsletters, and educational workshops.
Ready to get started? Register your organisation for free — we look forward to seeing you on the platform!