Day 105

Setting up online donation capabilities – easy, right?

One thing that we noticed when starting to work at the Chol Chol Foundation was that they don’t have a great way to receive donations online. Currently, their site has a donation page, but it simply includes their bank routing numbers that would be available for wire transfers. In the age of credit card and digital payments, the thought of going into your bank (in person) or online to initiate an expensive wire transfer is basically a non-starter.

Current online donation approach.

When we asked them how many donations they receive annually per this method they said (if I recall correctly) they’ve gotten like 2-3 donations in like 5 years via this channel. So that seems … ineffective.

It was on Sarah and my plate to explore options and see if we could find ways for anyone around the world to donate to Chol Chol via their website. I took this on this past week since Sarah has been cranking away on videos and on updates to the website.

I thought I’d document this process as it always seems easier than it is in reality here.

First, I did a bunch of research on fundraising and online payments, but most of that information takes you to crowdfunding sites which isn’t really what the foundation is looking for. There are many sites out there that you can raise for a certain event, but they were looking for more consistent or repeatable donations for the foundation itself vs. a “point in time cause”.

From there, I shifted some of my research for proper online payments for not for profits. I stumbled upon what appears to be the perfect article: “Payment Processing: The Beginner’s Guide”, specifically focused on payment processing for non-profits. I actually (shockingly) have experience within the payments industry so I understood how it worked, but I still didn’t know who could be the solution to Chol Chol’s situation. The big problem was that they want to be able to receive international funds and then eventually deposit into their Chilean bank – not many payment solutions offer that combination.

I went through the article and started identifying Payment Processors to call. I started with iATS Payments because they said it “only works with nonprofits, and their expertise in nonprofit donations is second to none.” Um, that sounds great. I give them a call, talk to a very nice person and find out within 3 minutes that they don’t operate in Chile or support Chilean banks. Great.

I then try BluePay, since they offer a recurring donations option and do a lot of work with nonprofit solutions. Once again, they don’t do Chile – only US and Canada. Okay.

From here, I read more and see that PayPal has the capabilities to take international donations. I start going down the rabbit hole of PayPal and come to realize that their international currencies are limited to about 20 counties. Of course, Chile is not listed on there.

After more research, I come across something called MultiCaja, which apparently partners with your PayPal business account and allows you to withdraw donations from your PayPal account and deposit them into your Chilean bank account and exchanging them into Chilean Pesos, and it only costs 0.5% of the transfer amount (with a minimum transfer amount of $10 USD). Bingo.

I do a bunch of research on PayPal and see that US-companies have a fee structure of 2.9% + $0.30 a transaction. However, if you can prove it’s a not-for-profit, the fee is down to 2.2% + $0.30 – well that’s even better.

I make a phone call to PayPal to talk to someone to learn a little more about all of this and collect some requirements for setting everything up. It’s not like I have all the necessary foundation information and bank account info, etc. I get on the phone with someone who mentions that I need to speak with the international team and that he’d transfer me. He says he is going to put me on hold for a minute. One minute turns to 30 (yes, thirty), and therefore, I hang up.

I do some additional research and then find the (Chile) site and try their call center. I get on the phone with someone and do my best to speak Spanish (but fail). I eventually am able to ask if there is anyone that speaks English, and he says yes and will transfer me. Sweet! He transfers me and it goes through an automated message and then, boom. I hear the dial-tone as it auto hung-up on me. Awesome.

I then find a way to contact PayPal via online message and so I share with them the details and what I’m hoping to accomplish. I get an email back the next day with a number to call and a case number to reference. So I finally think I’m getting to the point where I can talk to someone who knows what they may be talking about.

I get on the phone, and it connects me with someone who understands the situation I’m exploring. He explains to me that the 2.2% is only for US-based charities, and that there is a good chance that they won’t be able to validate a Chilean foundation, and therefore I’m stuck with the 2.9% fee. Okay, 0.7 is not a big deal, and I just want to get this puppy set up. He says that I’d need to create a business account for the foundation, and that from there, we’d be able to add a “donate” button to their WordPress website.

I then ask him about Multicaja and it’s capabilities and fee structure, and he has no idea what I’m talking about – as he has not heard of Multicaja. Okay.

Therefore, I give up on finding someone who can provide me all of the details (in English) about this particular scenario.

I start to create the business account for the foundation. Of course, it’s asking for a lot of information that I do not have, including Susana’s RUT/passport number, date of birth etc. I text Susana who provides the info and I’m finally able to get the account set up. WAHOO!

So now, I decide to test it out and log into my personal PayPal account to start sending money amounts over to the foundation’s account. I send amounts of $10 and $5. I log into the Chol Chol account and luckily it’s been transferred correctly! Unfortunately, the amounts look smaller than I expect. After some quick math, I’ve come to realize that the fees were $0.30 per transaction (like it said), but instead of 2.9%, it was 5.4%. So we have now gone from hoping for 2.2% to 5.4%. I do some more research and apparently they have a fee structure that is variable depending on the location of the donor and the destination of the recipient. Apparently, US to Chile is 5.4%.

5.4% fees are worse than 2.9% fees.

From here, I know that I need to explore this Multicaja thing. I start to create an account for Chol Chol and it asks me a lot of details, including a lot of bank routing number information. Susana provides the necessary information and I get an account created. Perfect. However, in order to ensure it works, they now have to send a money transfer from the Chilean bank account to Multicaja to confirm it (#security). Okay, so Susana tells me that the accountant will do that the next day and then hopefully we can confirm that Multicaja and Banco de Chile are linked.

The next morning, Susana forward me the completed transfer and I log back into the Multicaja account and click refresh and it says that everything is linked and complete. Wahoo!

To further the tests, I then go into Multicaja and it tells me how much is in the Chol Chol PayPal account (yes, it’s truly linked now). And so I attempt to withdraw $10 (as that was the stated minimum); however, it says that I need have $20 to withdraw $10. Huh? I do some more research, and come to realize that the Multicaja fee structure is tiered. It charges a 0.5% fee if the transfer amount is over $2,000. For anything less than $2,000 it charges $10 a transfer. Not cool.

Therefore, I deposit more money from my PayPay account into the Chol Chol PayPal (which gets cut at 5.4% and $0.30), and then refresh Multicaja so that there is over $20 in the account. I go through and attempt to process the $20 withdraw, to withdraw approximately $10 (because, you know, $10 fees), which is approximately 6,500 Chilean Pesos that should be deposited into the Banco de Chile Chol Chol account.

Will that transfer be immediate? Of course not. It takes 5 business days. I completed the transfer yesterday. Now I wait. Fingers Crossed.

Want to see a magic trick? It only takes 5 days to turn $20 in US currency to $10, but in the Chilean Pesos equivalent – or $6,517.

Bottom line – and something we’ve come to learn often here – is that nothing is simple or easy. Patience is very important down here.

And while this process (and many others) are frustrating and often an up-hill battle, it’s all worth it in the end. I emailed all the details to Susana and explained everything including the fees. Her response: “Esto es un Hilo en la fundación. Algo que queríamos tener siempre y nunca supimos cómo proceder. Muchísimas gracias!” Translation: “This is a milestone in the foundation. Something we wanted always to have and never knew how to proceed. Many thanks!”

Worth it.

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