GoFundMe: How Does GoFundMe Works

September 29, 2022

Just hearing about the GoFundMe platform? If you haven’t heard of this platform, then you are lucky to read this article. This blog contains lots of vital information about GoFundMe. GoFundMe has been seen as the perfect answer to so many issues.

But how does this platform serve as an answer to problems, you may ask? To find out about this, and how the platform works, then you need to continue reading this wonderful article. Within this content lots of information will be shelled out, so please don’t miss out.

GoFundMe

What is GoFundMe and how does it work? GoFundMe is an American crowdfunding platform. Do you know what crowdfunding is? For the purpose of those who don’t know what crowdfunding is, here it is. Crowdfunding is the practice of funding a project by raising specific amounts of money in small pieces via a large number of people.

This is done typically via the internet. Now, that is that for crowdfunding. This platform (GoFundMe) allows people to donate and raise money for various events ranging from life events such as celebrations and challenging events such as accidents and illness.

The company was founded in May 2010 by two men known as Brad Damphousse and Andrew Ballester in San Diego, California. The name of the platform was original ‘create a fund’ in 2008. The name was later changed to ‘GoFundMe’ in 2010 after upgrades were made to the site. According to statistics, this is the biggest crowdfunding platform in the world.

This platform is responsible for raising over 5 billion USD since its inception in 2010. The platform receives over 140 million USD in donations every month. Do you know that this platform made over 100 million USD in revenue in 2016 alone? Yes, they did. GoFundMe is currently valued at a whopping 600 million USD.

How Does GoFundMe Work

GoFundMe is a for-profit company. This means that this company does make profits from its operations. The platform allows users to create their own websites through which they can raise money. The platform is a secure way through which people can collect and distribute funds or donations electronically. Users create campaigns they want to address on the platform. They set a goal and the amount they wish to raise.

Lastly, they describe the reason they need the money via stories or photographs. After setting up a campaign on the platform, you start sharing your campaign links to friends and other sympathizers via social media links and emails. You can also donate on the platform directly in the form of national tragedies and others by going directly to the platform. On the platform, you will see various campaigns. Select any one of these campaigns and donate.

Is GoFundMe Free?

Making donations on the platform is free. You do not have to set up an account before you can make donations. But if on the other hand, you are setting up a campaign on the platform, GoFundMe is free, but it’s all depending on your location. The GoFundMe fee is 5% of each donation you receive. The payment processing fee is 2.9% plus 30 cents per donation. If you are in the US, UK, and Canada, there will be no 5% charge.

How Are Donations Collated and Distributed

The process is not as hectic as it may look. The platform is an easy-to-understand one and this is evident in the way the platform is set up. This platform has a payment processor system through which donations are processed. These collected donations are only released to named beneficiaries of the said campaign. Donations can also be released to campaign organizers who have direct contact and connection to the beneficiary.

Does GoFundMe Make Money Off Campaigns?

Well, this is a great question. One might ask, does GoFundMe make money off tragedies? Remember I stated earlier that this is a for-profit company and then explained what for-profit means. Its business model is solely built on the number of donations it processes. This platform gets a 2.9% payment processing fee on every donation. It also charges 30 cents for each and every donation. Also when donations exceed campaign goals, the campaign organizer can choose to continue receiving money or stop receiving money.

Can GoFundMe Be Used For Scams?

This is one of the major concerns regarding the platform. There have been reports of GoFundMe scams over the years. There are two major ways through which the platform can be used for scams. Stories and pictures of genuine campaigns can be hijacked and donations redirected to different fraudulent websites. Another means through which the platform can be used for scams is that these scammers can simply create fake sympathy campaigns.

To therefore protect yourself on the platform against scammers and fraudsters you need to stick with verified accounts verified by the GoFundMe Company. These verified accounts have been vetted and should be safe. If you ever become suspicious of any account on the platform, contact the campaign organizer or the GoFundMe platform directly.

Are Donations Guaranteed

Funds generated through GoFundMe are guaranteed. These funds will go directly to the victims or beneficiaries of campaigns on the platform. If in the event of misuse or irregularities of campaigns, funds of donors are protected and will therefore receive refunds. If a campaign organizer refuses to deliver funds to the right beneficiary, GoFundMe will donate the said undelivered amount to the right person.

How to Make Donations on GoFundMe

Making donations on this platform is easy and can be done by just anyone. You do not need to have a registered account on the platform before you can donate. All you need to have to be able to donate on this platform is the campaign URL you want to make a donation.

If you do not have the campaign URL, you can visit the GoFundMe platform directly at www.gofundme.com, search for campaigns and make your donations. You can search on the platform using the search bar or the magnifying glass icon. To search on the platform is easy, but to make your search more easy and precise, it is advisable to make use of the following criteria;

The GoFundMe campaign title.
Full name of the organizer.
The full name of the beneficiary.

Once you have identified the campaign you want to make donations to, simply click on ‘donate now to get started.

GoFundMe Donation Practices

When donating on the platform there are some practices to perform in other to prevent your donation from being automatically refunded. Below are some of the practices to indulge yourself in when making donations;

Always make donations with your personal name. Prevent using aliases when donating.
Make donations with your personal card and device.
Avoid making several donations to a campaign in a row. It is therefore advisable to make donations in one larger amount.

Adhere to the practices above and you will have a great experience on the platform.

Accepted Cards on GoFundMe

Donations on the platform can be made by anyone and from various credit and debit cards, but it is not all cards that are acceptable. Below are some of the acceptable cards on the platform.

MasterCard.
Visa.
American Express.
Discover (Canada excluded).
GiroPay (Germany).
Sofort (Germany).
PayPal accounts.
iDeal (Dutch).

If in the event you are having issues with your donations via your card, you should get in touch with the campaign organizer to request another means of payment or donation. Doing this is easy. Tap or click on the envelope icon next to the organizer’s name. This will enable you to send a direct message to the campaign organizers.

How to Start a GoFundMe Campaign

Anyone can start a GoFundMe campaign and the whole process is easy and free. To start a campaign on your desktop or mobile, visit the GoFundMe platform online at www.gofundme.com. On the homepage, tap or click on the start a GoFundMe tab and follow the on-screen instructions. Trust me, the whole process is easy, just as I have stated above.

How to Unsubscribe From Campaign Updates

You may have subscribed to a campaign you donated to and maybe after some time you feel like it’s time to unsubscribe from the said campaign. If you wish to do this, follow the steps below;

Go to the GoFundMe contact form using this link https://www.gofundme.com/contact/suggest.
On the contact form page, select the ‘I am a donor or supporter’ tab.
Select the ‘unsubscribing from emails’ tab.
Enter your email address in the prompt or pop up and click on ‘unsubscribe’.

That’s how you unsubscribe from receiving updates on a campaign via email.

Frequently Asked Questions

How do you get the money from a GoFundMe?

GoFundMe gets your funds to you quickly because they know that fundraising needs are time-sensitive. You can set up withdrawals and add your bank account as soon as you accept the campaign organizer’s invitation to make you a beneficiary. Bank transfers then take 2-5 business days to arrive.

What can you use GoFundMe for?

Most people use GoFundMe to raise money for things like medical bills, educational expenses, memorials, volunteer trips, youth sports – even animals & pets! The possibilities are endless.

Can I Make a GoFundMe for Myself?

If you’ll be managing transfers yourself, whether to a personal or company account, select “yourself”. If you’ll need to add a beneficiary, select “someone else”. And if you are raising funds for charity and would like the funds to be sent directly to that charity, select “Charity”.

How long does it take to get money from GoFundMe?

It takes 2 – 5 business days for transfers to reach the bank account after leaving GoFundMe. Your GoFundMe transfers overview will show the date that funds are expected in your bank account, not the date they’re sent from GoFundMe.

Do You Pay Taxes on GoFundMe Money?

Generally, contributions made to “Crowdfunding” campaigns are considered to be personal gifts, and as such, are not taxed as income to the recipient. The IRS does not consider fundraising proceeds a taxable source of income.

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