1% to 3% won't even cover the direct costs of being an intermediary for payments if you e.g. accept credit cards.

Such levels of pricing is not sustainable unless you're burning money to provide the service at a loss while you gain market share and network effects.

I agree that 20% fee seems excessive, but as soon as you're handling other people's money, 1-3% are not reasonable rates, they are unrealistically low, not feasible even for a non-profit that has all volunteer workforce.

It may be feasible to have a very low fee business model if you expect everyone to pay each other directly, but that still means managing all kinds of nonpayment and fraud issues, which takes a lot of time and thus expenses.