Why Your Facebook Friends Will Soon Be Asking You for Money
Business + Economy

Why Your Facebook Friends Will Soon Be Asking You for Money


If you’ve looked at Facebook lately, you’ve probably seen a post directing you to a GoFundMe page for a friend of a friend raising money following a personal tragedy of some kind, from cancer to foreclosure.

Now Facebook is making it easier for people to raise money for good causes, by allowing them to crowdfund directly on the social networking site.

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American users 18 and older can now use a “personal fundraiser” feature to raise money in six categories of financial need -- education, medical, pet medical, crisis relief, personal emergency, and funeral and loss. Requests to create a fundraiser will go through a 24-hour review process, and fundraisers will pay a 6.9 percent plus 30 cent fee to cover payment processing, security and other overhead costs. That compares favorably with GoFundMe, which charges 7.9% plus 30 cents per donation.

“Personal fundraisers allow people to reach friends where they already are to quickly build momentum for their cause,” Facebook’s vice president for social good Naomi Gleit wrote in a post announcing the new feature. “Friends can donate in a few taps with secure payments, without leaving Facebook.”

The need for such fundraising reflects the precarious financial position of many Americans, which often leaves them with no safety net beyond asking friends and acquaintances for assistance. Nearly half of Americans could not cover an emergency expense of $400 without selling something or borrowing money, according to a 2015 report from the Federal Reserve.

Medical expenses, in particular, have become major financial disruptors for families, as more Americans find themselves in high-deductible health plans while the cost of health care is rising.