Direct and deferred funding: what’s the difference?
Learn more about direct funding as well as deferred funding, an option used in special circumstances.
When you create a RallyUp fundraiser, the beneficiary organization will receive the funds raised through your campaign in one of two ways:
- Direct funding: With this option, funds are deposited directly to your bank account daily.
- Deferred funding: In this option, funds are collected and held for payment until a later date (US campaigns only; funds are held for a period of 90 days).
If you’re directly affiliated with a nonprofit or charity group, choose direct funding when registering your organization. This will ensure your organization can receive funds in daily deposits made directly into your bank account. If you're an individual or business raising money to benefit a nonprofit but are not affiliated with the organization, your funds will automatically be collected using our deferred funding option. If this applies to your fundraiser, you can read more about how you will withdraw and send funds to the nonprofit at the end of your campaign.
Direct funding is the fastest and most inexpensive way to process and receive the funds raised through your campaign. Funds are deposited directly into your bank account, and you can receive a discounted nonprofit rate on payment processing fees.
All it takes to set up direct funding for an organization you belong to is an email address. Once you enter the email address you’d like to use for your direct funding account, you’ll receive an email from Stripe (RallyUp’s payment processor) with instructions to securely provide your direct deposit information.
RallyUp has partnered with Stripe to process all donations made to your organization’s fundraiser. Stripe is a Tier 1 payment processor (the highest level of security) that transacts billions of dollars every year for some of the largest companies in the world. Learn more about Stripe here.
Click the button below to learn how to set up direct funding:
You may belong to an organization but receiving funds directly into its bank account isn't possible due to its structure or policies. For instance, your organization may not allow your department to set up its own funding account. In these special circumstances, you can use deferred funding instead.
When you choose deferred funding, the funds raised on your campaigns will be collected and temporarily held until a later payout date. You’ll simply request funds when your campaign ends to begin the 90 day hold.
If your campaign requires deferred funding, there are a few details you should know about this option:
- There is a $5,000 limit on the amount raised with raffle and sweepstakes fundraisers. If you plan on raising more than $5,000, please create or link a direct funding account to collect the funds raised.
- Funds will be sent to your organization via a digital check approximately 90 days from the date of your request to allow time for refunds and chargebacks to be processed. The digital check will then be sent by email from our partners at Checkbook.io. The funds can be deposited directly into the organization’s bank account via ACH using the link in the email or deposited by printing the check.
- If your organization has financial data listed in GuideStar or has a DUNS number, you may apply for alternate funding arrangements by emailing firstname.lastname@example.org.
- Donations processed using deferred funding will have a Stripe processing fee of 2.9% +$0.30 per transaction (Stripe's standard rate). This is slightly higher than the nonprofit rate available through direct funding.
The vast majority of RallyUp customers use direct funding unless there is a specific reason they can't. Setting up direct funding takes only a couple of minutes, and the process is built right into your organization settings on RallyUp. Direct funding offers lower processing costs and quicker financial progress towards your goal, as daily deposits of funds are made right into your bank account.