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How to avoid chargebacks on personal donations|tips|contributions|sponsoring

Discussion in 'Payment Processing' started by Dirk the Web Phoenix, Dec 3, 2019 at 10:54 AM.

  1. #1
    Hi, everybody:
    SEMrush
    I am looking for up to date advice from people with experience. (not found in recent forum searches)

    I want to give visitors on one of my websites the option to leave a tip, in other words: make a donation, sponsor the site, fund me so I can pay for the hosting service and over time improve the website they can use for free. I'd like to set up an uncomplicated account with a money transfer service and simply link to it. (I live and work in the Americas and Europe, currently as freelancer.)

    I want it to be easy and safe (for both them and myself).

    ___Two Worries:___

    (1) chargeback fees: crooks can demand a chargeback on a donation, not only taking the money back but costing me a big fee.
    (2) tax mess: payment services may send info on my received donations to tax agencies (wrong info to wrong agencies in the case of a professional nomad like me)

    So, what is a good service without any of these problems? :)
     
    Dirk the Web Phoenix, Dec 3, 2019 at 10:54 AM IP
    SEMrush
  2. Dirk the Web Phoenix

    Dirk the Web Phoenix Greenhorn

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    #2
    ___Why I ask:___
    (some background info and links to stuff I came across leaving me bewildered and worried)

    When I searched the Internet on it, I came across only charity-blabla connected to the term "donations" and chargeback stories mostly connected to sales, but SCARILY also sometimes chargebacks in cases of donations. For example, here is a young youtuber telling how he was assaulted with PayPal chargebacks (and their FEES!) on donations to his Youtube channel:


    And here is an article I came across which explains donation fraud: https://www.thebalancesmb.com/keep-donors-safe-preventing-online-credit-card-fraud-4148333

    So, with an unsafe service or faulty account setup I might end up with a big pile of $20 chargeback fees instead of a handful of actual donations/tips/contributions or whatever the correct word to use actually is. And, as mentioned before, I need to juggle the tax agencies of different countries, so any reporting to any agency by a money transfer service could get me into trouble by the discrepancy between my correct filing and the faulty filing of such a third party transaction service that won't know when I was where.

    Encountered services:

    (A) PayPal -- I found the policies I read on PayPal far too vague and convoluted for me to grasp. A forest invisible for all the trees: "PayPal.Me", "personal payments", "gifts", "donations", "Money Pool"; "friends and family" "personal payments" that may have no chargebacks possibility, but am I a "friend" of my free site users getting a "personal payment" from them? If yes, how to set it up, as a PayPal.Me or a Money Pool, or what?

    (B) Patreon: no idea about chargeback risks, but it definitely insists on messing with taxes. (at least in Europe, but possibly the U.S., too)

    (C) Escrow.com claims "buy and sell anything safely without the risk of chargebacks"... But does it handle donations?

    (D) Stripe Offers SMBs Chargeback Fraud Relief... but apparently only to registered businesses.

    (E) GoFundMe, no idea about it, yet. Is it only for humanitarian aid? Maybe it's identical to crowdfunding sites like Kickstarter that make contributions complicated and insist on time limited and amount-goal-plagued "campaigns"...?


    All I want is a harmless tip jar.


    Thanks a million for any hints or clues, especially when backed up by experience. :)
     
    Dirk the Web Phoenix, Dec 3, 2019 at 10:59 AM IP
  3. qwikad.com

    qwikad.com Illustrious Member Affiliate Manager

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    #3
    I doubt that you can find a service that can completely protect you from chargebacks, since they will be dealing with digital / virtual goods. IMO PayPal will be your best bet and as you have mentioned if you can receive it via friends / family option, the donators won't be able to start a dispute. Although, they still can stop the payment if they paid using their CC. You should overcome your worries and give it a try.
     
    qwikad.com, Dec 4, 2019 at 7:44 PM IP