Intro to Payment Gateways for Your Crowdfunding Site

Gabriel Richards
Founder & CEO

Choosing a payment gateway for your crowdfunding campaign site is much like choosing a business partner. The right choice can enrich and uplift your business, while the wrong choice may haunt you for years to come.

Moreover, not every payment gateway is created equal, and most have been tailored to meet highly specific business needs that may not be applicable to your crowdfunding campaign. Fortunately, a simple comparison of the major payment gateways is all it takes to help identify which solutions will work best for you.

Crowdfunding Basics

The two most common types of crowdfunding payment methods are the all-or-nothing and partial credit models. With an all-or-nothing model, if a campaign fails to meet its financial goal, pledges are not charged and the campaign is canceled. Sites like Kickstarter as well as many potential donors prefer this methodology. It provides the best assurance that funds aren’t going to be wasted and thereby achieve the goal that motivated participation in the first place.

Putting aside for the moment which model may fit your campaign best, a downside to the all-or-nothing method is that a portion of pledged cards will likely be declined when charged. Consequently, total funding isn’t completely guaranteed. That can be devastating for small campaigns dependent on every last donation, as well as detrimental to large campaigns since they are disproportionately affected when a large number of donors end up in the declined category.

Alternatively, in the partial credit model, your campaign does not have to achieve its financial goal in order to be awarded at least some funding. Sites like Indiegogo prefer this methodology. Pledge cards can be charged immediately so you don’t have to deal with preauthorization or declined cards. The partial credit model is ideal for campaigns that have sufficient credibility to garner pledges in that manner.


WePay provides the essential functionality necessary for both the all-or-nothing and the partial credit payment model. While WePay doesn’t technically offer an escrow feature, it does allow you up to 60 days to choose to charge cards or release funds.

Settings in WePay can also be adjusted in a manner to match your earnings model. In other words, if you’re running a partial credit campaign, you won’t have to worry about micromanaging payments or wasting time with escrow-like features. It also supports a highly customizable API (“Application Programming Interface”) for your goal and campaign duration settings, making it an ideal choice for anyone operating their own crowdfunding platform.

Similar to its competitors such as PayPal, the WePay processing fee is 2.9% + $0.30. But unlike PayPal, WePay lets you decide exactly who will be picking up those fees.


As the most popular payment gateway used today, PayPal hardly needs an introduction. With some of the most customizable features of any gateway (e.g., delayed disbursements, mass refunds, et al.) PayPal has it all.

Similar to WePay, PayPal has a custom API that allows you to send and receive payments on your own terms. PayPal however currently has more extensive credibility because of how many people do business with it (i.e., 110 million active accounts currently). And to top things off, PayPal supports up to 24 currencies.

Authority is an important element to any crowdfunding platform or campaign. The popularity of PayPal can confer a level of authority to your campaign, especially when compared to payment gateways that are unknown to a majority of consumers.

Endertech is a Los Angeles Web Developer able to provide solutions for your web design and web applications, including Crowdfunding sites. Contact us for a free consultation.

- Gabriel RichardsFounder & CEO | 

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