Payment handling cost comparison

If a member buys a £5 pass, how much will your club receive?

  • Cash : £4.96
  • Makesweat : £4.63 (37p cost)
  • Paypal : £4.63 (37p cost)
  • Eventbrite : £4.23 (77p cost)

 

All sports clubs want to make the best use of the income they receive from members, so we’ve put together a comparison of various methods you can use to collect payments, and the pros and cons of each.

For comparison, we’ll consider a single fee for a swimming session, in this example costing £5.

Let’s start with what seems the cheapest: Cash

 

Cash

A customer hands over five pounds to a club commitee member. The committee member is then responsible for ensuring the payment quickly reaches the club bank account. For the purposes of this example we’ve assumed that the club isn’t run through a cash box. It should be obvious to any club that the risk of fraud, loss, theft and error is so extreme with a cash box that no club officer should ever put themself in the position of being exposed in this way.

Cost

  • 0.7% cash handling cost from bank (1) – 3.5p
  • Manual payment cost (*1) discounted as any cash will be batched.
  • Club receives £4.96
  • There is a time and fuel cost to the person paying in cash; this is discounted from this calculation as although it’s a drain on goodwill, it doesn’t appear on the balance sheet.

Pros

  • Lowest numerical cost to receive payment
  • Some immediate recycling is possible; potentially paying venue cost out of cash received

Cons

  • A club representative is physically required to receive cash
  • There is a human and financial cost to paying in cash to a bank account
  • Customers do not generally carry much cash; for larger purchases, unlikely they will have sufficient cash. Inconvenient to go via a cash machine to take out cash
  • A manual process is required to reconcil attendance and passes
  • The most vulnerable to fraud, theft and loss

 

Makesweat

Cost

(For Makesweat.com payment flow method)

  • Stripe card processing fee fee : 1.4% + 20p
  • Makesweat fee : 2%
  • Club receives £4.63

Pros

  • Standard benefits of online payments; convenience, security, etc.
  • User’s payment is linked to session attendance; passes and sessions are managed by Makesweat
  • Payment automatically paid into club account (5 banking rolling days)
  • Can handle tokens / passes / packs natively

Cons

  • Makesweat isn’t (yet) an internationally recognised brand.

 

Paypal

It’s hard to find out Paypal’s fee structure for manually sending payments to a business account; we assume you’re using a business account for your club, as per Paypal’s T&Cs. Paypal hide the actual fees in their User Agreement, Schedule 1 (*2). We assume A2. Commercial Transaction payment fees apply.

Cost

  • Base Paypal fee : 3.4% (A2.2.2.1)
  • Paypal fixed fee : 20p
  • Club receives £4.63

Pros

  • Standard benefits of online payments; convenience, security, etc.
  • Paypal is a well established and trusted brand

Cons

  • Paypal is just a way to move money; it doesn’t help to run a club
  • A manual process is required to reconcil attendance and passes
  • Paypal holds funds until manually moved into club bank account

 

Eventbrite

Cost

  • Eventbrite fee : 3.5% + £0.49
  • Payment processor fee : 2%
  • Club receives £4.23

Pros

  • Standard benefits of online payments; convenience, security, etc.
  • Established brand
  • Can provide an attendance list for an event

Cons

  • It’s designed for occasional large events (concerts, etc.), not optimised for clubs with frequent repeating sessions
  • A manual process is required to reconcil attendance and passes
  • Doesn’t handle tokens / passes / packs

 

 

1: Natwest Business Account charges : http://www.business.natwest.com/content/dam/natwest_com/Business%20and%20Content/downloads/Current-Accounts/Charges/NWB5965%2B10-11-14%2B90521908.pdf

2: Paypal UK fees : https://www.paypal.com/uk/webapps/mpp/ua/useragreement-full

3: Eventbrite fees : https://www.eventbrite.co.uk/fees/