Dwolla: An Online Payment System to Rule them All

I've had an ongoing love hate relationship with Paypal. I loved the convenience it offered me to accept money from just about anyone in whatever way the sender saw fit. I could transfer a few bucks to friends far away or send money to family if needed. Unfortunately, Paypal is leased to the life sucking credit card companies who siphon off significant money from each transaction. I hoped Google Checkout would be better, but alas both charge 2.9% + $0.30 for transactions. That isn't exactly cheap if your looking for small donations from people on the net.

Dwolla to the Rescue

Dwolla is here to completely change the game by bypassing the credit card companies and going straight to your bank. This allows them to operate a much leaner operation making transactions under $10 US completely free. That's right FREE! So, you can set up an account to accept donations from your visitors and on anything under $10 you get every penny.

You might be wondering, well how does Dwolla make any money, won't they go out of business doing all this for free? It's a good question and fortunately it comes down to one simple fact, transferring around funds electronically really isn't that expensive. Some estimates I've seen put the number including all the technology costs and staffing at only a couple cents. So, Dwolla has chosen to go with a flat rate charge on transfers of over $10 and it's a very reasonable $0.25.

No matter how much you send it's just a Quarter taken from the recipient. That means if you send $50 to a friend as a gift, they get $49.75 of it, or about $0.15 less. Now let's think bigger and suppose a family member living a couple states away has an emergency and they need to borrow $1,000. Dwolla still charges just $0.25, while Paypal or Google Checkout would take $29.30! That's a massive difference for your and your family member.

The Power for Bloggers is in Small Donations

All Bloggers hope to provide quality content to their visitors. We work hard and enjoy what we do. It's always nice to get a little recognition from readers they like what you're doing and are willing to support your work. Dwolla allows you to seek small dollar donations and you get to keep every penny. This means the reader knows the all the money goes to you, the Blogger, rather than some company. So if they want to give $10, $5, $1 or even just a dime it all goes to the right person. I see this as a very big shift in what is possible within the blogging community as small donations become quick and easy.

Conclusion

Dwolla has a lot of potential for the blogging community and content publishers in general. It's far cheaper and more friendly for small spur of the moment transfers than credit cards. You can even carry out high dollar transactions quickly with no fuss for just a quarter. I'm really excited to see this system go online(U.S. only currently). I highly recommend checking out Dwolla.

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