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I'm working on a new personal cause-centered website for giving money to families in need, people with illnesses, disaster victims, etc. I'm in the planning phase now, trying to work out the payment details. My ideal provider would provide the abilities to:

  • Run inline transactions (on my website, with our without an iFrame)
  • Create users via the API and/or send money to users that haven't been created
  • Pay out to recipients via the API from a main holding account OR send money to multiple recipients at once

Based on research, I don't think PayPal Payments Standard or Pro will work. PayPal Standard isn't inline and PayPal Pro has a reputation for denying crowsourcing applications. For example, Fiverr.com and GoFundMe.com use PayPal Standard presumably because they didn't get approval for PayPal Pro.

Another concern I had with using PayPal Standard is that I might get hit with fees twice: once upon receipt into a holding account and once paying the money out to the individual recipients.

Does anyone have experience with this or recommendations on payment providers? Thanks!

Chris Voth
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5 Answers5

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The best API to use in my opinion is with WEPAY.COM. I would take this advice since I'm probably the only one not trying to sell anything to you in my response. I am developing a similar patform for education at www.Canigive.com and we are using the wepay api, it works great for us.

Mark J. Savard
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I think our product Balanced would be a good fit since it's designed for this.

Payments come in much like with any credit card processor, however, instead of going to your merchant account, the funds are held in an escrow account until you're ready to disburse them. Once you're ready to disburse you can create two payments, one to a merchant (who will receive the majority of the funds), and a second to yourself to collect a fee.

Everything is run via a RESTful API so there's no need for an iFrame or redirecting users away from your site.

Payments out are currently limited to within the US as Balanced uses next-day ACH for settling credits to merchants however you can charge funds from anywhere in the world provided you're OK with doing it in USD.

To see a customer of ours with a similar business model to what you're asking about, have a look at Crowdtilt.

mjallday
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Actually the recommended approach with PayPal is the Preapproval functionality in Adaptive Payments API. This is what GoFundMe uses too AFAIK.

I have answered two questions on quora related to this that you might find interesting about PayPal's recommended approach for crowdfunding projects like this:

http://www.quora.com/PayPal/I-want-to-use-Paypal-for-my-self-hosted-crowdfund-campaign-but-I-heard-they-might-close-my-account-if-theres-too-much-money-coming-in-is-there-a-way-to-fix-this

http://www.quora.com/PayPal/Is-paypal-better-for-crowdfunding-than-amazon-payments-why-or-why-not/answer/Praveen-Alavilli?snids=55404046#ans1382191

Let me know if you have any questions that I can help with.

Praveen
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Braintree is a full-stack payment platform that can support crowd funding businesses similar to yours. We can offer you everything you need to start accepting online and mobile payments. You seemed to be interested in the ability to pay out to recipients, as for right now we cannot support outgoing payments. Feel free to get in touch with us if you have any questions. Disclosure: I work at Braintree

Caitlin
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  • When you store a Customer's payment info via Braintree's secure credit card storage, is this the same as getting preapproval in Paypal's adaptive payments? Can you really charge a customer 30 or 60 days down the road? – mikong Oct 18 '12 at 07:14
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    @mikong You can store a card with us and do a $0 verification to make sure the card is good. As long as that card remains good, you can charge it whenever. That might be 30 days later or 18 months later. – Caitlin Nov 20 '12 at 17:08
  • Thanks for the reply. Better late than never :) – mikong Nov 21 '12 at 06:39
  • Does it work outside the US? I am in Australia – Ivan Wang Apr 29 '13 at 18:15
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PayPal's "Adaptive Payments" is the best product that supports crowdfunding models. https://developer.paypal.com/docs/classic/lifecycle/crowdfunding/

user529577
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