Regular Giving Grows for Third Consecutive Year in U.K., Fundraising Report Finds
“The most exciting news is that for the first time we have undeniable proof that re-presenting certain failed Direct Debits prevents unnecessary loss of income, and charities need to be made aware of this. This issue is not widely understood; charities just don’t know about it and are losing money and regular donors.
“Commonly charities treat all unpaid Direct Debits as donation cancellations whereas our analysis shows that more than half of all ‘unpaids’ are due to insufficient funds in the donor’s bank account and returned as Refer to Payer, rather than being active cancellations by the donors.
“Our research shows a staggering 62.5% of Refer to Payer unpaids go on pay in the following month. This demonstrates how we should not write off the donation, or the supporter, because of one failed payment but should pursue the relationship.
“Very few charities analyse their unpaid donations past counting them all as just cancellations, nor do they have a re-present policy in place. It only takes some minor tweaks to the administration process to gain a significant amount of income, reduce attrition figures and the costs of reactivation programmes. For a large charity this could mean thousands of pounds a month. Even if you’re a small charity and you’re losing just one donation of £10 a month, it adds up – if the donation is there but you’re just not collecting it you’re simply losing money down the drain.”
Commenting on the report’s top line findings, Gray says:
“Average gift value has increased quite considerably, which I would say proves the case for quality upgrade campaigns. The heightened focus on existing donors through the tough economic climate has really paid off. And this also backs up the long-term argument for Direct Debit versus Standing Order. A Direct Debit is flexible for changes and easily upgraded by the charity as opposed to a Standing Order where the donor has to make any change for you with the associated risks of prompting cancellation.