All About California’s Charitable Fundraising Platforms

Charitable fundraising platforms (CFPs) are a new regulatory category in California, introduced under Assembly Bill 488 (AB 488) to bring oversight to digital platforms that solicit, collect, and distribute charitable donations. While this law took effect in June 2024, many companies – especially those facilitating donations at scale – are still unaware of the new compliance requirements.

From e-commerce brands integrating donation options at checkout to fundraising platforms supporting thousands of nonprofits, AB 488 introduces strict donor data, disbursement, and consent requirements that significantly impact how companies operate. Here’s what you need to know about the new landscape of charitable fundraising platforms – and how Change helps companies like Bonfire and DailyKarma stay compliant.

What Are Charitable Fundraising Platforms (CFPs)?

Under California AB 488, CFPs are defined as digital platforms that facilitate charitable giving by soliciting, processing, or distributing donations to nonprofits. This includes:

• Ecommerce platforms allowing customers to round up their purchases for charity.
• Corporate giving platforms that enable brands to launch donation campaigns.
• Peer-to-peer fundraising sites that host campaigns for multiple charities.

The law establishes new obligations for these platforms, requiring them to:

1. Protect donor data – Platforms must provide donors with an option to share their information with the charity.
2. Ensure timely fund distribution – Donations must be sent to nonprofits within 30 days of the end of the month in which they were received.
3. Secure written nonprofit consent – Companies must obtain explicit approval from nonprofits before featuring them in any fundraising campaign.

Failing to meet these requirements can lead to regulatory penalties, nonprofit disputes, and reputational damage.

The Compliance Challenges for Fundraising Platforms

For platforms supporting thousands of nonprofits, complying with AB 488 is a logistical nightmare. Managing donor data privacy, accelerating payouts, and obtaining written nonprofit consent at scale requires extensive legal and operational resources.

For example, DailyKarma, an ecommerce donation platform used by brands like Lancôme and Rare Beauty, faced the challenge of updating its entire system to comply with California’s new rules. With thousands of donation campaigns running across various online stores, aligning with new donor data and payout regulations was a major undertaking.

Similarly, Bonfire, a platform that enables individuals and organizations to sell custom merchandise for fundraising, had to ensure its donation process met California’s strict disbursement timelines while handling nonprofit approvals efficiently.

How Change Helps Companies Stay Compliant

Change simplifies compliance by automating the hardest parts of AB 488:

• Donor Data Protection – Change ensures that donor data is securely collected and shared only with nonprofit partners who opt-in. This eliminates the risk of unauthorized data exposure.
• Fast, Transparent Fund Disbursement – Change enables platforms to send funds within 30 days via direct ACH payouts, ensuring that every transaction meets regulatory timelines.
• Nonprofit Consent Management – With Change’s dashboard-based approval system, nonprofits can easily grant or revoke consent to be featured in donation campaigns, removing the need for manual tracking.

By partnering with Change, DailyKarma quickly adapted to AB 488, ensuring donor data was shared securely, funds reached nonprofits on time, and every featured nonprofit had documented consent. Bonfire and other platforms have also streamlined their compliance efforts with Change, using automated ACH disbursements to meet the 30-day payout rule and leveraging a centralized dashboard to track nonprofit approvals. Without these solutions, platforms risk operational bottlenecks, legal scrutiny, and lost fundraising opportunities. By embedding compliance into their workflows, these companies can focus on scaling impact rather than managing regulatory complexity.

The Future of Charitable Giving Compliance

AB 488 is just the beginning of increased oversight in digital charitable giving. Rumor has it that states like Hawaii and South Carolina may be following suit. As regulations evolve, platforms that proactively build compliance into their operations will be better positioned to scale without legal risk.

For companies facilitating donations, the choice is clear: adapt now or risk falling behind. With Change, businesses can turn compliance from a regulatory burden into a seamless, automated process, ensuring that donations are handled transparently, efficiently, and legally.

If your platform processes charitable donations and you’re unsure about compliance, book a demo with us today. We help companies navigate the complexities of AB 488, so they can focus on making an impact.