Donor-Covered Fees: How Zero-Fee Fundraising Really Works
Donor-covered fees add processing costs to a supporter's checkout so the fundraiser receives the full donation amount they selected.
That is the honest meaning of zero-fee fundraising for the organizer on HandyPay. The transaction still has a processing cost, but it is shown separately and paid on top by the supporter instead of being deducted from the cause. If a donor chooses US$50, the campaign keeps US$50; the donor's final card total is the gift plus the displayed fee.
Disclosure: HandyPay wrote this first-party explanation of its own fee flow. The examples below use HandyPay's published rates and show the calculation rather than treating “free” as a vague marketing claim.
Donor-Covered Fees in One Minute
When donor-covered fees are enabled, the checkout has two economic parts:
- Donation: the amount the supporter chooses for the fundraiser.
- Processing cost: the amount added to cover card processing, HandyPay's service fee, and currency conversion where applicable.
The two parts make up the supporter's total card charge. The selected donation reaches the fundraiser in full.
This model is also called fee recovery, fee-on-top fundraising, or supporter-paid processing. Those phrases describe the same basic idea: calculate enough on top of the intended gift to cover the cost of processing the combined payment.
A Worked US$50 Donation Example
Here is a simple USD example for an organization on HandyPay's free plan that settles in USD:
| Checkout item | Amount |
|---|---|
| Supporter's chosen donation | US$50.00 |
| Processing and service fees | US$3.00 |
| Total charged to supporter | US$53.00 |
| Amount the fundraiser receives | US$50.00 |
Why is the added fee US$3.00 instead of 4.9% of US$50 plus US$0.40? HandyPay grosses up the total. The processing rate also applies to the fee amount being collected, so simply adding US$2.85 would leave the fundraiser slightly short.
The calculation is:
(US$50.00 + US$0.40) ÷ (1 − 0.049) = US$53.00, rounded to the nearest cent.
The US$3.00 difference covers the transaction cost, leaving the full US$50.00 for the organization. On the Pro plan, the percentage is lower, so the supporter total for the same gift is also lower.
A US$50 donation assumes an approved fundraiser account. Standard donation links cap each donation at the local-currency equivalent of US$10 until HandyPay approves higher limits; see the main donations guide for how verification and limits work.
The HandyPay Rates Behind the Calculation
HandyPay's published payment rates are:
| Plan | Transaction rate | Subscription |
|---|---|---|
| Free | 4.9% + US$0.40 | No monthly fee |
| Pro | 4.2% + US$0.40 | US$29/month or US$290/year |
For accounts that settle outside USD, the calculation may also recover the relevant currency-conversion cost. The fixed US$0.40 portion is converted into the charge currency using the rate available when checkout is created.
Because exchange rates and plan status can change, the final amount shown at checkout is always the definitive amount the supporter will pay.
No Monthly Fee, No Deduction, and No Processing Cost Are Different Claims
Fundraising pricing becomes confusing when three separate ideas are all described as “free.” They are not the same:
| Claim | What it means |
|---|---|
| No monthly fee | The organizer does not pay a recurring subscription on HandyPay's free plan |
| No fee deducted from the gift | The supporter covers fees, so the fundraiser keeps the chosen donation |
| No processing cost exists | No one pays to process the card transaction |
HandyPay can provide the first two together: no monthly subscription on the free plan and no processing fee deducted from a donor-covered gift. It does not claim the third. Card payments have a processing cost, and a transparent checkout should show who pays it.
Why the Fee Appears as a Separate Line
HandyPay displays the added amount separately as processing-related fees rather than quietly changing the donation itself. This makes the checkout easier to explain:
- the supporter can identify the gift they chose
- the supporter sees the additional cost before paying
- the organizer can accurately report the intended donation amount
- the payment record distinguishes the campaign amount from fee recovery
Clear language is especially important for charities and community campaigns. A useful appeal is: “Processing fees are added at checkout so 100% of your chosen gift reaches the fundraiser.”
Avoid saying simply “there are no fees,” because a supporter will see a higher total at checkout. The more precise statement builds trust and reduces abandoned donations.
What Happens When the Organizer Absorbs Fees?
If the campaign is configured for the organizer to absorb fees, the supporter pays exactly the donation amount they chose. HandyPay then deducts the applicable processing, service, and currency-conversion costs before calculating the organizer's net amount.
Using the same US$50 free-plan, USD-settlement example:
| Checkout item | Amount |
|---|---|
| Supporter's chosen donation | US$50.00 |
| Total charged to supporter | US$50.00 |
| Processing cost deducted | US$2.85 |
| Amount the fundraiser receives | US$47.15 |
Neither mode is inherently right for every campaign. Donor-covered fees protect the campaign's target, while organizer-covered fees keep the supporter's card total equal to the amount entered. The campaign's public copy should match whichever mode it uses.
How to Explain Donor-Covered Fees to Supporters
Use one short sentence near the donation link and repeat it before the supporter leaves your campaign page. For example:
Your processing fee is added at secure checkout so the full donation amount you choose goes to our fundraiser.
It also helps to answer three questions in advance:
- Is the fee part of my gift? No. It is a separate amount used to process the payment.
- How much will I pay? The exact total appears before the card payment is confirmed.
- How much does the fundraiser receive? The full chosen gift when donor-covered fees are active.
That is clearer than promising a “100% free platform” without explaining the supporter's final total.
Frequently Asked Questions
What are donor-covered fees?
Donor-covered fees are processing costs added on top of a supporter's selected donation. The supporter pays the combined total, allowing the fundraiser to receive the full chosen gift.
Does HandyPay charge charities a monthly fee?
HandyPay's free plan has no monthly subscription. Its transaction rate still applies to each donation, but that cost can be placed on the supporter so it is not deducted from the selected gift.
Why is the fee slightly higher than the published percentage plus US$0.40?
The total is grossed up because the processing percentage applies to the complete card charge, including the fee being collected. Grossing up prevents the fundraiser from receiving slightly less than the intended donation.
Are currency-conversion costs included?
When an account settles outside USD, the donor-covered calculation can include the applicable conversion recovery so the chosen donation still reaches the fundraiser. The exact total is displayed in the checkout currency.
Can the fundraiser pay the fee instead?
Yes. When fees are set to the organizer, the supporter pays only the amount entered and the applicable costs reduce the organizer's net proceeds.
Is the fee tax-deductible for the supporter?
HandyPay does not determine tax deductibility. That depends on the recipient's legal status, the nature of the payment, and local law. A qualified charity should provide the appropriate guidance or receipt.