The Reason PayPal Is Giving Its Mobile App A 'Donate' Button

PayPal already processes a ton of charitable donations as the following article explains. But it also faces competition from Apple Pay and a host of other payment processing apps.

Given the popularity of giving to causes, this addition serves to connect PayPal with its users even more securely, building that ecosystem that all online enterprises desire - and need. JL

Sarah Perez reports in Tech Crunch:

Mobile giving has been on the upswing, which is why PayPal made this change. Last year, 38.7 million people donated $6.6 billion to charities through PayPal, and 23 percent of these were on mobile devices. That’s up 33 percent from 2014.
PayPal is rolling out an update to its mobile application which it hopes will put charitable giving in the forefront of customers’ minds. With a new button that appears at the bottom of the home screen of its app  – below options to order ahead or pay in-store – PayPal users can support a favorite cause through an in-app donation.
The button connects users to the tens of thousands of PayPal Giving Fund certified charities, and is the first time that PayPal has made it possible to donate directly through its mobile app, the company says.
Before, you could make Giving Fund donations online. Charities could also use PayPal’s “donate” button on their own websites to encourage giving. However, in-app donations were never part of PayPal’s own app experience until now.
The charities will receive 100 percent of every donation, PayPal also notes.
Mobile giving has been on the upswing, which is why PayPal made this change, it explains. Last year, 38.7 million people donated $6.6 billion to charities through PayPal, and 23 percent of these were on mobile devices. That’s up 33 percent from 2014.

One of the standout causes that benefited from PayPal donations was disaster relief for the Nepal earthquake, where more than $19 million was raised in 2015. PayPal says 74,000+ people donated on mobile, contributing $4 million to the effort. And on December 1, 2015, PayPal also set a world record for most money raised online for a charity in 24 hours, as part of PayPal’s #GivingTuesday campaign. Users then raised $45.8 million for various causes.
Today, more than 497,000 charities accept donations via PayPal, and 38.7 million people use PayPal to make payments to charities. However, not all these are enrolled in PayPal’s Giving Fund, so will not be accessible through the new button, it seems.
The addition of the button means PayPal has also managed to skirt around Apple’s App Store rules regarding charitable donations. Apple has banned apps that collect funds for charities and fundraisers, unless they collect funds outside of the app, such as through Safari or SMS.
PayPal is not violating Apple’s rules, however. Most of the donate flow is a native experience, but when it comes to complete the transaction, a mobile web page opens. When the donation completes, customers are returned to the native app. Though compliant with Apple’s policy, the experience is designed to feel seamless for the end user.
The update is rolling out now in PayPal’s mobile app Version 6.4.