How Local Churches Can Use a Merchant Account for a Financial Boost

One of my mystical teachings to feeling badly about not having cash to put into the church collection plate on Sunday mornings. She states, “I never carry cash anymore… I pay all my bills online. I don’t even write checks… and I forget or am too busy with the kids to get cash before the Sunday service…

As electronic services continue to change the financial landscape, fewer people carry actual money. More churches are realizing that in order to stay alive they must modernize and promote technologies that facilitate giving. A well set up merchant account is a great tool that churches can use to encourage giving.

Having a merchant account allows churches to accept credit or debit card payments from church members. Donating or tithing by credit or debit card is simple for congregation members – and research shows that having the ability to accept payment cards can significantly increase the volume of financial gifts to faith communities, many of whom struggle to make ends meet.

There are a several benefits to setting up a merchant account for your church. With a merchant account your church can:

• Accept donations over the Internet on your church’s website
• Accept debit and credit cards by having a debit machine on site
• Process cards with a wireless terminal or mobile device-great for bazaars/fundraisers

Another great benefit of having a merchant account is that it allows your church to accept “recurring” payments. Congregation members can set up automatic monthly donation plans on their cards each year, month or week, as they see fit.

Other pros to investing in a direct merchant account for your church include:

• Lower transaction fees as a non-profit organization. A good rep may be able to access reduced or waived service fees for your church.

• Your Church’s Name on the Credit Card Statements – If your church has a real or direct merchant account the church’s name will be on the donor’s statement and on all receipts. This facilitates tax receipts. If you donate online to a charity through a ‘third party processing’ service, quite often it is the processor’s name that will appear on your receipt.

• Control – With a direct merchant account, you control the direction and deposit of funds to church accounts. There is no middleman and no one else controlling the timing and flow of your deposits.

• Convenience – Donated funds and gifts through a merchant account are deposited to your bank with a push of a button.

Depending on your congregation and the general group feeling around the idea of mixing payment cards in a spiritual setting, there are certain issues of concern that may arise.

For example, one church in Vancouver felt uncomfortable with the idea of encouraging debt through the use of credit cards and opted to go with a debit machine programmed to only accept debit cards. The machine is placed on a stand inside the church in a cozy private vestibule. There is always a steady stream of folks who use the machine before or after the service to give collection.

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