Why GalaBid Never Touches Your Campaign Funds

In late 2025, a major fundraising platform was accused of withholding or severely delaying donation payouts. Nonprofits reportedly waited many months to receive funds their supporters believed had already been delivered.

The state Attorney General’s cease-and-desist order noted roughly $500k–$615k in identified delayed transfers to a group of nonprofits and required the platform to place funds into a restricted (blocked) account pending review.

This situation exposed a difficult truth:  nonprofits should be very cautious about trusting any fundraising platform that holds campaign funds.

It also highlighted how critical payment processing decisions are - not just for financial operations, but for reputation, sustainability, and mission delivery.
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1. What Nonprofits Should Look for in a Fundraising Platform’s Payment System

Payment systems may not be the most exciting part of fundraising - but they are the most important. They determine how quickly you receive your funds, how safe those funds are, and how much control you really have.

When choosing a fundraising platform, nonprofits should look for these five essentials:

Fast, Reliable Payouts 

‍You should receive your donations within days, not weeks or months. Clear payout timelines should always be available.

Separate, Protected Funds

Your donation funds should never be mixed with the platform’s operating funds. This protects your organisation if the platform runs into trouble.

‍Clear Legal Compliance

‍Platforms must follow fundraising and payment laws. If a platform can’t clearly explain how it complies with regulations, that’s a warning sign.

Real Human Support

If there’s a problem, you need fast, helpful answers—not automated replies or silence.

The Ability to Use Your Own Merchant Account (such as Stripe)

This gives you direct ownership of your donations and removes unnecessary risk.

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2. Why Third-Party Processors Like Stripe Offer Better Protection

Third-party processors like Stripe, PayPal, Square, and Braintree exist solely to move money securely and legally. They are heavily regulated and built to protect both donors and nonprofits.

Here’s why they offer stronger protection:

Your Funds Go Straight to You

When you connect your own Stripe account, donations flow like this: Donor → Stripe → Your bank account. The fundraising platform never touches or holds your funds.

Strict Rules and Oversight

Stripe operates under global banking and anti-fraud regulations. This greatly reduces the chance of funds being mishandled.

Full Transparency

You can log into Stripe at any time to see every donation, payout, refund, and transfer.

Protection if a Platform Fails

Even if a fundraising platform shuts down, Stripe continues to process and pay out your donations.

Put simply: Stripe gives you independence from platform risk.

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3. The Rise of Platform “Wallets” - And Why Caution Is Needed

Some fundraising platforms now offer internal “wallets” where donations are stored inside the platform before being withdrawn.

Here’s how wallets usually work:

• Donations go into the platform’s system
• Funds sit in a platform-controlled account
• You withdraw the money later
• Some platforms offer interest for keeping funds inside

While this may sound convenient, it introduces new risks.

Key Risks to Understand

1. The platform holds your funds, not an independent processor
2. Wallet balances are often not insured like a bank account would be
3. Withdrawals may be delayed during reviews or busy periods
4. Less visibility into how funds are stored and protected

Before using any wallet system, nonprofits should always ask:

• Who legally holds the money?
• Where is it stored?
• Is it insured?
• How fast can it be withdrawn?
• What happens if the platform closes?

If any of these answers are unclear, there's potentially a serious risk.

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4. GalaBid’s Approach: We Never Hold Your Funds

At GalaBid, we made a simple decision: we don’t touch your funds. This removes one of the biggest risks in fundraising.

When a donor gives through a GalaBid campaign, funds move as they should:
Donor → Stripe → Directly to your bank account

GalaBid does not:

• Store your funds
• Delay payouts
• Pool donations
• Control when you get paid
• Operate wallets

You stay in control at all times.

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4. Why Using Your Own Stripe Account Matters

When you connect your own Stripe account to GalaBid:

• You receive all deposits directly
• You can track every transaction in real time
• You can issue refunds and manage disputes yourself
• You are never dependent on GalaBid to access your money

This gives you full financial independence and clarity.

GalaBid Does Not Make Money From Payment Fees

Many platforms increase processing costs by adding hidden markups.

GalaBid does not do this.

• You pay Stripe’s standard rates only
• We take no margin from your processing fees
• If Stripe offers you nonprofit discounts, you keep them

Why This Matters

The recent platform crisis was a wake-up call for the nonprofit sector. It showed how quickly an organisation can be put at risk when access to donations is lost.

Nonprofits deserve platforms that prioritise:

• Financial safety
• Transparency
• Integrity
• Long-term trust

That’s exactly how GalaBid is built.

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5. Red Flags to Watch For in Any Fundraising Platform

Be careful if a platform shows signs of:

• Delayed or unpredictable payouts
• Unclear explanations of where funds are stored
• No option to connect your own payment processor
• Poor customer support
• Regulatory complaints or legal issues
• Restrictions on moving your donor data
• Contracts that make switching platforms difficult

One red flag is a warning. Several together may be a dealbreaker. It’s always worth checking independent reviews on sites such as Trustpilot to get the experiences of other users.

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6. Final Thoughts: Your Platform Should Never Be a Risk to Your Mission

No matter how advanced a platform’s features are, none of it matters if you cannot access your own donations.

When choosing a fundraising platform:

• Make sure you understand exactly how money flows
• Choose systems that pay directly to your bank
• Be cautious of wallet-style holding systems
• Prioritise financial safety over convenience

Your donors trust you with their funds. Your platform should respect that trust.

Your funds should always be protected, accessible, and delivered without delay.

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If you have any questions about platform security, contact our team: helpdesk@galabid.com

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