GoFundMe Removes 5% Campaign Fee, Introduces Voluntary Tips

Now that we are firmly in the giving season that surrounds all the various wintertime holidays, more and more personal crowdfunding campaigns will likely appear online. People asking for the kindness of strangers to make it through the stressful end of the year often utilize platforms like GoFundMe to make that possible. Thanks to a minor change in GoFundMe company policy, it will likely be easier than ever to launch such a campaign.

The popular crowdfunding platform was set to drop the five percent fee that it traditionally charged to people starting personal campaigns, TechCrunch reported. In the past, the company took five percent of whatever the campaign earned, regardless of its size. This new change would apply exclusively to users in the United States for now, so anyone in need anywhere else would still have to give up some of their earnings to GoFundMe.

In addition to the five percent platform fee, a 2.9 percent processing fee also existed. The processing fee would remain, the company said. Any campaign run by an actual charity will also still need to pay the five percent fee, as this change only applies to personal campaigns.

“The holidays are a time for giving and generosity. GoFundMe is always looking for ways to make fundraising easier, faster, and more successful, and this time of year made perfect sense for introducing this pricing structure,” GoFundMe CEO Rob Solomon said in a statement, according to TechCrunch. “From the beginning, our giving community has been incredibly generous. With this 0% platform fee, we will rely on voluntary tips from our donors to help with the costs associated with providing our best-in-class customer service, trust & safety protections, and social fundraising technology.”

In order to make back some of the profits GoFundMe is losing by dropping the five percent fee, those who donate can now voluntarily add a tip to their donation. GoFundMe, however, would not commit to keeping this structure in place permanently, beyond this holiday season.

TechCrunch pointed out the start of the holiday season might not be the only reason GoFundMe announced this change now. Facebook dropped fees for campaigns run by non-profits Wednesday, so this could simply be a case of one crowdfunding service one-upping another. Either way, both developments are potentially for the benefit of people who need money.

Five percent of a crowdfunding campaign can be quite a bit for people in serious financial need, so this change will likely be welcome by people facing big obstacles this holiday season. In an era when people are turning to social media to fund medical and housing expenses, this should ease the pain just a little bit.