U.K. Charity Direct Debit Cancellations Highest Ever in August

Press release (Sept. 8, 2011) London — The Charity Direct Debit Cancellation Rate for August 2011 has been recorded at an all time high at 4.58% in the U.K. This is the highest cancellation rate seen in the month of August since Rapidata Services Plc, the charity transactions processing agency, began tracking regular giving trends eight years ago in 2003. The figure exceeds the August 2008 mid-recession figure of 4.4%.

Scott Gray, managing director, Rapidata Services Plc, says, “The recent increases in cancellations have spiked yet again in August to a shocking 4.58%. I am deeply concerned to see charity Direct Debit cancellations increasing again to recession levels and higher. I wouldn’t be surprised to see the rate exceed 5% in September with the trend continuing. Charities need to know about this shift and they need to act.

“This is this fourth consecutive month that cancellations have increased and although I was hoping we were seeing a temporary blip it is becoming clear that the trend has shifted once more with our figures reflecting the recent sharp economic downturn and threat of double-dip recession. Consumers are tightening their personal finances still further under uncertain economic conditions that are unlikely to improve very quickly.”

The economy grew just 0.2% in the second quarter and we saw unsettled market volatility once again through August. A Gfk NOP survey conducted on behalf of the European Commission showed British consumer confidence fell in August to its lowest level since April. And a CBI survey showed last week that retail sales fell at their fastest pace in over a year in August with spending on food even – not normally affected – falling.

“However, we should remember that Britain is one of the most generous nations and we should not be disheartened,” Gray continues. “We’ve been here before and seen recovery, but it means being proactive. Charities should be looking at their current activities and asking whether they are doing everything they can to minimise cancellations and attrition. The increases we’re seeing represent many thousands of pounds of lost donations each month, but also the loss regular donors. Now is the time to be as proactive with donors as possible. If you are stalling a stewardship programme or have communications, appeals or campaigns on hold, it’s time to act.