PayPal is broadening its support for charitable giving with the introduction of the Generosity Network today. Distinct from the PayPal Giving Fund, which facilitates donations to charities via the internet, this new network empowers individuals to solicit funds for their own needs, assist others facing hardship, or support organizations such as local businesses or non-profits. This positions the network as a direct competitor to existing crowdsourcing fundraising services, such as GoFundMe and Facebook Fundraisers.

Initially, the Generosity Network will be available exclusively to PayPal customers located in the United States, enabling them to establish fundraising initiatives with a target of up to $20,000 over a period of 30 days.

The company explains that the development of this service was prompted by the expansion of the peer-to-peer fundraising sector in the wake of the coronavirus pandemic. It also highlighted that the pandemic has presented challenges for traditional charities in their fundraising endeavors. PayPal reported, referencing a survey (PDF) from the Association of Fundraising Professionals, that over half of U.S. charities anticipate receiving less funding in 2020 compared to 2019 due to the economic difficulties caused by the pandemic.

Furthermore, PayPal notes that more than 65 million people in the U.S. have filed for unemployment at some point during the pandemic, frequently leading them to seek financial assistance from family, friends, and their communities.

This represents a continuation of PayPal’s involvement with social fundraising products. Previously, the company launched Money Pools, which allowed groups to contribute towards shared expenses – such as surprise parties, collective gifts, or travel funds. The Generosity Network builds upon the foundation of this earlier initiative.

Fundraisers within the new Generosity Network can be initiated directly through PayPal’s website, with donations being deposited directly into the organizer’s account for distribution. These campaigns also benefit from broader visibility on the Generosity Network platform, potentially reaching a significantly larger audience than the organizer could achieve through their own social media and web-based promotions.

Currently, PayPal users are utilizing the platform to raise funds for disaster relief, funeral costs, medical bills, community projects, and various other organizations.

Similar to other fundraising platforms, PayPal’s Generosity Network will incorporate fees. However, the website currently states that these fees are being waived for donations made using credit and debit cards for a limited time. Fees associated with international transactions and currency conversions will still be applicable.

For context, Facebook does not impose fees on donations made to charitable organizations, but it does charge fees for personal fundraisers (currently 2.60% + $0.30 in the U.S.). GoFundMe’s U.S. transaction fees are set at $2.9% + $0.30.

We have requested PayPal to provide a detailed fee schedule for the new platform, but the company indicated that this information will not be available until early 2021.

The website currently lacks information regarding fees, and its FAQ section even directs users to the Money Pools FAQ, suggesting that the Generosity Network may not yet be a fully developed product. Additionally, users accessing the Money Pools platform through the PayPal app and website are now presented with the option to create a Generosity Network campaign instead.

PayPal anticipates attracting users during the typically heightened fundraising activity of the holiday season and believes that a fee-waiver policy will provide a competitive advantage over established platforms.

The company does not seem to be implementing extensive vetting procedures. It stated that, in addition to its Acceptable Use Policy, it has also introduced Generosity Network Campaign Content Standards, outlined in the Generosity Network Terms. These standards define the terms customers must agree to when using the service, including providing PayPal with information or documentation if requested, but do not specify proactive vetting processes.

“From collecting money for grocery deliveries to high-risk populations to fundraising campaigns in support of teachers and frontline workers, we’ve seen an outpouring of generosity from the PayPal community using our platform to help one another during this unprecedented year,” stated Oktay Dogramaci, PayPal VP of Giving. “The Generosity Network was designed to provide an accessible, easy and secure way for our customers to raise money on behalf of causes, and connect them with millions of PayPal customers who can offer their support this holiday season and beyond,” he added.