What If Checks Were Going Away?

As a Dutch native and international fundraiser, who grew up with a central banking system, automatic payments and payment forms called acceptgiros, I’ve been following some recent payment trends.

In the next few years, the Netherlands and several other European countries are planning to do away with acceptgiros, which are somewhat equivalent to checks. The Netherlands is scheduled to stop sending acceptgiros in mid-2023 — that’s just around the corner. New Zealand is also doing research on doing away with checks.

Netherlands’ Acceptgiro Process

In the Netherlands, an organization sends an appeal that includes an acceptgiro. This serves as both a payment and reply form. It’s prefilled with the donor’s contact information and, in some cases, the donor’s bank account information.

The donor fills in the amount, signs it and sends it to their bank. Then the bank scans the information and provides that to the nonprofit, which must upload that information into their database.

The acceptgiro acts as the reply form. The bank is the data-entry/cager in one go. Banks have very sensitive scanners in place, so there is no manual keying involved. Many donors use these payment forms, just like we use checks in the U.S..

Fundraisers are now forced to figure out what is best to send to their donors. One approach (called a Payment Instruction) consists of a form with a QR code, a proposed amount, and a direct link to the payment page and the information to key in the information for online banking. For those who don’t want to bank online, you can take the information to your bank directly. And. of course, online giving is always an option.

Impact of U.S. Check Donations

This made me think: What would doing away with checks mean for fundraising in the U.S.?

I think the New Zealand case study, which estimates nonprofits could lose $1.4 million when the country phases out checks, is one that could become a reality and we should be especially mindful of.

While in the U.S. online gifts on average made up some 15% of all donations last year, that still means that some 85% comes in offline, through checks. Even donor advised fund gifts are often done by check although more and more nonprofits are asking for direct deposits now. Even banking online often means that the person or company you’re trying to pay receives a check.

Doing away with checks would constitute a major mind shift. Well, we certainly had to shift our minds over the past few years, so what’s just one more thing? Of course, COVID-19 has certainly driven more people to give online than ever before, and I’m sure that will continue and keep growing, both via credit/debit card and through electronic bank transfer.

But we’re not quite there yet. Checks are so commonplace here. Though, at some point, banks might say that it’s too expensive or the paper may be harder to come by. (Don’t we all know about that right now?)

It made me think of the very successful approach I had tested (and kept testing out of) many years ago when I first started working in monthly giving. It was a monthly giving appeal aimed at check payers. The headline said: “Please don’t send me any more checks.” It worked exceptionally well in converting donors to give automatically as a monthly donor.

So, if you’re serious about protecting your nonprofit’s future in the long run and generating that sustainable revenue to keep your mission going, you may wish to seriously start thinking about how you can generate more monthly donors with automatic payments, so your dependency on checks will be less and less.

That way, if the day comes that banks say: No more paper checks, you’ll be totally ready.