Why Your Nonprofit Banking Relationship Matters More Than Ever

Given the state of things, most nonprofits have no shortage of battles to choose from. From fundraising shortfalls to the challenge of maintaining a consistent volunteer base, many nonprofit leaders can go weeks or even months without even thinking about their vendors.

But these kinds of challenges are exactly why every nonprofit should be taking a long, hard look at their vendor relationships – especially when it comes to their banking. “Banking will never be the sexiest problem to solve for your organization,” Julie Macaluso, Vice President of Commercial Banking at Amplify Credit Union, said. “But having a solid foundation for your money and a banking partner you can trust just makes everything else a little easier.”

To learn more about what nonprofit leaders should expect from their financial institution, we spoke with Macaluso and Lindsey Hufstader, Commercial Banking Relationship Manager at Amplify. Together, Macaluso and Hufstader weigh in on the importance of keeping your money secure and avoiding the kinds of financial mistakes that can set your organization back.

More Than Ever, Every Dollar Matters

Nonprofit leaders know the value of a dollar – and now, with government programs cutting back and families feeling the pinch, a dollar is more important than ever. Still, Macaluso warns that too many nonprofits treat bank fees as the price of doing business rather than a demonstration of their financial institution’s values.

“I like to look at it like this: how valuable is a recurring monthly donation to your nonprofit?” Macaluso explained. “I know many nonprofits put a ton of effort into encouraging their community members to set up a $10 or even $25 recurring donation. Now, imagine your bank wiping out a dozen of those recurring donations in monthly fees. That is money that should go towards making a brighter future for the people you serve.”

That philosophy is the driving force behind fee-free commercial banking at Amplify. Since the launch of the program in 2024, Amplify has remained committed to providing important banking services to its members – without the fees often associated with treasury management tools. “We don’t treat small nonprofits any differently than larger organizations,” Hufstader added. “The only thing that matters is giving you the banking tools you need to succeed at no additional cost to your bottom line.”

But helping members avoid fees is only half of Amplify’s approach to nonprofit banking. Macaluso and her team have also designed their savings accounts with nonprofits in mind, offering competitive interest rates on their high-yield savings accounts designed to provide their nonprofits with maximum flexibility. This is often a useful alternative to certificates of deposit, which can require nonprofits to lock their money up with their financial institution for 12 or more months at a time.

“Fixed-term savings tools like certificates of deposit often come with the most attractive rates, but most nonprofits I work with place a premium on liquidity,” Macaluso explained. “You need to be able to access your cash reserves at any time for any reason, so having an account where you can both earn interest and withdraw funds without delay or penalties is one of the driving forces behind our high-yield savings accounts.”

One Banking Mistake Can Set You Back

If recurring expenses like bank fees can slow your mission down, then a case of fraud can stop it in its tracks. According to a 2024 study from the Association of Certified Fraud Examiners (ACFEs), nonprofits represent 10% of all fraud cases, with a median loss of $76,000 to the organization. “People will always be the biggest target for fraudsters, which is why we coach our nonprofit members to take advantage of our tools to create healthy checks and balances for their organization,” Macaluso said.

Because many nonprofits operate with smaller teams – often requiring one or two executives to take on the responsibilities of several roles – access to a nonprofit’s transaction information can often fall on the shoulders of a single person. This increases the likelihood that the person may be the target of check fraud or phishing scams, giving the nonprofit no safety net if that person’s banking information gets compromised.

Luckily, there are banking services that can help provide those checks and balances for an organization. Macaluso recommends treasury management products like positive pay and ACH positive, which allow nonprofits to preapprove check and ACH payees while routing unauthorized payments back to the nonprofit for manual approval. These systems allow nonprofits to catch instances of fraud before the money is debited from their account, saving the organization time and money – two things they have in short supply. “When donated money goes away, it’s really, really hard to get that money back,” Macaluso added.

And while most financial institutions charge a monthly fee for positive pay, positive pay is one of the signature services included under Amplify’s fee-free commercial banking services. “With so many bad actors out there today, we view account services like positive pay as a necessity, not a luxury,” Hufstader added. “We don’t believe our nonprofit members should have to choose between paying a fee or keeping their accounts as safe as possible, which is why positive pay will always be free at Amplify.”

Your Organization Is Constantly Changing

Anyone who has ever served on a board of directors knows how difficult it can be to swap out signers. It’s not enough to get the new person onto the account – often times, they must be accompanied by an authorized signer, requiring you to line up at least two busy schedules from among your board of directors. And while most boards prescribe terms for their directors, research by BoardSource shows that only 54% of nonprofits actually enforce term limits, making turnover a fact of life for many nonprofits.

The need for flexibility with your signers has become even more important as remote relationships become more common. “One of the trends we’ve seen in the nonprofit space is more board members are coming from outside the immediate community of their nonprofits,” Macaluso said. “Board members are being chosen for the experience and skills they can offer the organization, and so more boards are comprised of remote volunteers who may live halfway across the country.”

To support these changes, Macaluso’s team recently transferred to an automated system that allows account signers to authenticate remotely – removing the need for people to physically visit a branch to be added or removed from a nonprofit’s bank account. “Whenever I go to chamber meetings or events around Central Texas, this is one of the biggest hassles nonprofit leaders share with me,” Hufstader added. “It may seem small, but the old process of switching signers on a bank account could grind an organization to a halt for weeks at a time.”

But automated systems are only part of the equation. Macaluso and Hufstader also believe that the ever-changing nature of nonprofit staff presents institutions like Amplify with the opportunity to provide continuity where it’s needed most. “At many of the big banks, you may work with a different account representative every time you call in,” Hufstader explained. “If you’re new to an organization, and you’re speaking with someone who’s looking at your account for the first time, it’s going to take you forever to get anything done.”

Not at Amplify. With both dedicated bankers for each organization and a dedicated phone line for commercial members, Hufstader and her team pride themselves on being a throughline during periods of uncertainty for their nonprofit members. “You worry about making a difference in your community,” Hufstader added. “We’ll worry about your bank accounts.”

Conclusion

If there’s one final thought Macaluso would like to leave nonprofit leaders with, it’s not to overlook credit unions like Amplify when it comes to banking. “As a not-for-profit organization, we have a similar mindset,” Macaluso said. “And banking with a local credit union like Amplify has the added effect of keeping more of your money in your immediate community – not halfway across the country.”

So as nonprofits turn over every stone in an effort to cut costs and maintain their impact, keep your banking relationship front of mind. If they’re not keeping your money safe and providing you with much-needed expertise, then switching to a financial institution you can trust may be one problem you can solve immediately.

To learn how Amplify’s commercial banking team can help your nonprofit get the most from your banking experience, please schedule a free consultation here.

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