PayPal today announced the launch of PayPal Giving Fund Australia, a registered charity that facilitates digital payments options for other Australian charities. The initiative is designed to combat an increasingly cashless society, a trend PayPal says is hurting donation levels.

PayPal will provide the technology and, along with partners, cover the operational costs of the fund, meaning 100 per cent of donations are passed on to charities. The initiative is already available in the US, Canada and the UK and raised over $130 million for 46,000 charities last year, according to Paypal.

“Traditionally, charities have collected their funding via cash or cheque donations. However, as consumer purchasing and payment behaviours become more digitised, the age-old cash donation is quickly becoming a thing of the past,” said PayPal Giving Fund Australia Director, Elaine Herlihy.

To coincide with the announcement, PayPal commissioned research to show the way donations are changing. According to the study, two out of five Australians (42 per cent) have intended to make a donation, but have not done so because they did not have any cash on them.

The number rises to 53 per cent for millennials and 65 per cent of all Australians believe online donations will outpace offline in the next five years.

Currently 21 per cent of donations are done via smartphones, up 75 per cent year on year, according to the study. A quarter of Australians used a website to make a donation in the past year.

Donate on Facebook

The PayPal Giving Fund includes a partnership with Facebook, allowing people to make donations directly through the social media platform. Registered non-profits and charities can, through the PayPal Fund and Facebook Fundraisers, create fundraisers and receive direct donations on the platform, capturing what PayPal says is a growing market.

Over a third (36 per cent) of Australians have used Facebook to discover a charity they proceeded to donate to, according to the PayPal research. Again the rate rises for millennials (52 per cent).

The study suggests Facebook is the preferred social media platform for donations and the more Australians would use it to donate to charities if they could.

“People often donate to support a friend who is undertaking a charity sporting event or because of a personal referral from family or friends,” said Mia Garlick, Director of Policy at Facebook.

“The launch of our charitable giving tools amplifies this activity and allows people to more easily donate to thousands of Australian charities through Facebook fundraisers.”

Earlier this month Visa announced a new POS product allowing charity collectors to accept digital payments while collecting on foot.

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