Business Technology

Saturday 15 December 2018

GoFundMe will stop taking platform fee out of fundraising campaigns

Fire engulfs Grenfell Tower in west London
Fire engulfs Grenfell Tower in west London

Andrew Griffin

GoFundMe will stop taking money out of donation campaigns, amid mounting criticism of crowdfunding sites.

GoFundMe and competitors like JustGiving allow people to raise money for a specific cause, with the site sitting in the middle and handling payment and other details – as well as taking money out of those campaigns.

Until now, all money raised on the site and its competitors have been subject to the platforms taking a cut. That funding model has led to sites being accused of taking money from worthy causes, with people who are donating not necessarily aware that people aren't getting all of the money they're giving.

The substantial cut that fundraising sites take out of donation has proven controversial in the past. Last year, for instance, it emerged that JustGiving would be taking at least £115,000 out of the money people had donated to the survivors of the Grenfell Tower disaster, and that the same site would make £30,000 out of the money given to the family of PC Keith Palmer, who was killed in the Westminster terror attack.​

Instead of taking money out of fundraising deals, donors will be asked to give a "tip" when they pay. That system is already in place in the US and Canada.

“We’ve been amazed by the generosity of people in the UK since we launched here," said Rob Solomon, CEO of GoFundMe. "We want to mark that anniversary by giving GoFundMe organisers in the UK the chance to raise even more money for the causes they love without a platform fee.  We’re looking forward to seeing more people giving and getting the help they need.”

Mr Solomon said that testing in other countries had shown that the different funding model is far more liked by those using the site.

“As we’ve rolled this new model out in the US, we've had a huge amount of positive feedback from our community. It’s a win-win move, and we think people in the UK will recognise the outstanding service we provide – and now we’re offering that service for free."

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