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.
Under California AB 488, CFPs are defined as digital platforms that facilitate charitable giving by soliciting, processing, or distributing donations to nonprofits. This includes:
The law establishes new obligations for these platforms, requiring them to:
Failing to meet these requirements can lead to regulatory penalties, nonprofit disputes, and reputational damage.
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.
Change simplifies compliance by automating the hardest parts of AB 488:
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.
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.