Mobile Payment Company Hopes to Make Text Donations Mainstream

Remember the ads asking you to donate $5 to help the victims of the Haiti earthquake in the aftermath of the catastrophe? All you had to do was send a text message to a 5-digit number. Now a mobile payment company called Obopay has partnered with Benevity, a non-profit that describes its activities as “social entrepreneurship”, “entrepreneurial philanthropy” or “creative capitalism” to offer a service they hope will streamline the process.

The partners will allow any charity that is registered in the United States to create an account and select a keyword. Donors will then make donations by texting the keyword to a shortcode number that is assigned to the charity by Obopay during the registration process.

For example, by texting “GORILLA” to 48510, a consumer can donate to the Conservation Through Public Health and support gorilla conservation in Africa. Texting “KIDS” to the same number will send a donation to support children’s charities in the California Bay Area, including YMCA of San Francisco, East Palo Alto Kids Foundation, etc.

Once a donor has texted the charity keyword, he or she is taken to a mobile payment site to complete the donation and receive a tax receipts. Unlike the Haiti donation campaign, the new service allows consumers to donate in much larger amounts, “up to hundreds of dollars,” according to the press release. The partners claim that non-profits will be getting a much faster access to the donations, “compared to other text-to-donate offerings that have been limited to $5 and $10 amounts and have taken over 90 days.” However, the press release does not specify just how fast this access will be.

Carol Realini, CEO of Obopay, defines the problem her company, in partnership with Benevity, is trying to resolve:

Crisis relief to Haiti put mobile donations on the map in America, but until now mobile donations have only been available for a handful of the largest non-profits and executed through carrier billing, which places limits on the amounts that can be donated and delays the receipt of funds.

However, she is rather vague in describing how her company’s new platform will make things better:

Our new text-to-donate offering, which can work with the Benevity micro-donation platform as its giving engine, meets these needs and meaningfully expands the market and speed for making and accepting mobile donations.

Overall, the new service sounds promising, although it would be helpful if we had more details on the program. And non-profits do need help collecting donations. At present, the payment card industry classifies charities as high-risk, making it harder for them to set up merchant accounts and accept credit card payments the traditional way. There are legitimate reasons for this classification, not least among them the statutory obligation for processing banks to ensure that donations are not used for funding terrorist or other illegal causes. Hopefully, Obopay and Benevity will help streamline the payment-collection process for legitimate charities, while still keeping the bad guys at bay.

Image credit: Wikimedia Commons.