I have been running a very small nonprofit for several years now. We have been using PayPal to accept donations and to sell one book. Sounds familiar right? I am posting this comment precisely because I am so much like the original person who started this thread.
First, we had a really really really hard time getting people to donate online with PayPal. In about two years of trying, we got maybe a half-dozen donations this way. Now admittedly, our nonprofit organization was an unusual one, surrounded by controversies, and we had a difficult time with fundraising regardless of the venue. But we did much better with mail-in donations, and also with door to door solicitations. But I don't think the problem with online donations was all about traffic. We were running a newspaper, with an online version also available. We got pretty good traffic.
The problem, I think, was largely PayPal. People don't want to sign up with a payment service just to make a donation, or to make a simple payment. The process of becoming a PayPal member (for potential donors) is relatively complicated and time-consuming. All they really want to do is give somebody their credit card number and get on with their lives. But PayPal asks for much more, and I think people find it very intimidating.
We had better luck selling our book online, but I believe sales of the book would have been higher had we used a more conventional merchant account system that does not ask purchasers to jump through so many hoops.
I have recently become increasingly frustrated with PayPal. First, I had a problem trying to resolve a purchase I made using my PayPal account. It was an e-bay purchase of software. The software turned out to be a crude bootleg copy, not at all as described. PayPal's policy is to not get involved unless the product is not delivered. So if you order a diamond and get a lump of coal, tough-luck buddy. PayPal won't touch your case. E-Bay was not much better, and it took a long, long time to resolve the dispute. I got most of my money back from e-bay, but it was a nightmarish ordeal. Then, E-bay bought PayPal. With these two sleeping in the same bed, who knows what good things will be spawned ...
But getting back to PayPal. My latest problem is that they won't let users have more than one account. So if you have a nonprofit and a for-profit business, as I do, you apparently can't set up two PayPal accounts. Actually, you can, but I'm finding out that you're not supposed to. Or maybe I am finding out that there is a certain way to do it, and I am apparently not doing it right. I think I managed to do it by using different credit cards to set up the acoounts. I may have also given PayPal different addresses. Not sure now.
The second account was for my for-profit business. My for-profit business actually has two distinct divisions. I sell bumper stickers on one web site. I sell chair casters on another site. All the money goes through PayPal, and ends up in the same bank account. At the top of my PayPal shopping cart, are the names of both divisions. Like this: "Casters and Bumper Stickers" (not the real names). This is awkward, and confusing for customers. So I e-mailed PayPal to see if there was some way to avoid this awkward situation. Here is part of their very helpful reply:
"You are allowed to have only 1 Premier/Business Account, we show you have 2. One of these account must be either downgraded to a Personal Account OR closed completely. Please do so to avoid limitation being placed on both accounts.
Our User Agreement also states Credit Card, Bank accounts can not be shared. If the account is active on one PayPal account, it can not be used on another.
A separate credit card, bank account would have to be set up for the additional PayPal account.
I will monitor your PayPal accounts to ensure you are within our User Agreement guidelines."
So now I am quite upset with PayPal. I have been using PayPal for more than two years now. They have collected a fair number of fees from me. I guess I'm small potatoes ...
Anyway, I am looking for other options now. I am considering 2Checkout.com. I am also looking closely at mypaystems.com. I welcome any other suggestions that webmasters may have.