Finder is committed to editorial independence. While we receive compensation when you click links to partners, they do not influence our content.
PayPal Generosity Network: What is it and how does it work?
PayPal Generosity Network is open for $20K in funding with no fees.
PayPal announced an expansion of its PayPal Giving program that will allow businesses to raise money through crowdfunding. Anyone can create a campaign — but the strict limits on how much you can raise may not be enough for your business.
How PayPal Generosity Network works
PayPal Generosity Network allows anyone with a verified PayPal account to raise up to $20,000 over a 30-day campaign period. These donations don’t need to be repaid and there are no fees to create a campaign. However, PayPal states in its terms of service that it reserves the right to charge a fee in the future — although it isn’t clear what this fee might look like.
All donations are final and are immediately transferred to the PayPal account connected to the campaign. While you can use the funds for business, you cannot sell any goods through the Generosity Network or offer an incentive for donations. Linking to an outside website — including your own business website — is also prohibited under PayPal’s terms of service.
To create a campaign, you only need to sign in to your PayPal account and provide details about how much you want to raise and what you’re raising money for. From here, it’s all about promotion. Posting on social media and asking for donations from your customers can be effective ways to draw attention to your need for funding.
PayPal Generosity Network vs. peer-to-peer loans
The amount you can raise through the Generosity Network is limited, and you still have to promote your campaign on social media to raise awareness.
If your business is established and you have fair credit, you may want to consider peer-to-peer business loans. Your business will need to pay interest — something you won’t need to worry about with the Generosity Network — but you won’t have to rely on donations to get funded. You may also be eligible for a larger amount: some peer-to-peer lenders offer up to $50,000.
4 more funding options for small businesses
For larger amounts of working capital, PayPal offers loans up to $300,000. These loans are only available to businesses that have a PayPal Premier or Business account and make at least $15,000 in annual sales. Other business owners might want to consider one of these options to get the funding their businesses need:
- Crowdfunding. PayPal Generosity Network is new, but it isn’t your only option. There are multiple types of crowdfunding opportunities available to businesses, including big names like Kickstarter and Indiegogo.
- Microloans. If you only need a small amount, look into microloans. These small-dollar options are good for newer businesses.
- Term loans. Term loans cover a wide range of loan amounts and funding options for all businesses. While your business will need to be at least a few years old and meet revenue requirements to qualify for most funding, there are some loans available to startups.
- Lines of credit. Lines of credit are much more flexible than term loans or microloans. Your business can borrow what it needs when it needs it — and it will only pay interest on that amount. Rates tend to be much lower than credit cards.
Photo: Getty Images
More guides on Finder
PayPal business loans review
Short-term loans for all credit types — but watch out for high fees.
How does PayPal.Me work?
Learn how to create a custom link for your PayPal account and what you can use it for.
How does peer to peer insurance work?
Embrace the sharing economy of insurance, paying for damage out of members’ pooled funds.
Cross border fees: What they are and how they work.
If you plan to sell internationally, be prepared for this compulsory processing fee.
How do MFI loans work?
Nonprofit funding for individuals and businesses in underserved communities.
What is Masterpass and how does it work?
Pay more conveniently at participating online retailers.
Common bank fees and how to avoid them
Mismanaging your finances can result in costly bank penalty fees. This handy guide shows you how to avoid them.
How to shop with PayPal and earn reward points
Link your credit card to your PayPal account and you could earn points, enjoy Buyer Protection and even avoid some card payment fees.
6 tips for crowdfunding to pay off student loan debt
Get the most out of this unconventional way of repaying your loans.
Does PayPal accept American Express?
You can use your American Express credit card with PayPal. Buying products and services doesn’t incur a fee, but sending money with your card does.
Ask an Expert