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By Lisa A. Hephner
Implementing an auto-recurring giving program can reduce fundraising costs and increase donations.
Auto-recurring giving takes fundraising to the next level.
It enables donors to easily and automatically make regular payments as part of a giving program that gets set up once, and then runs for any duration desired.
In fact, the Association of Fundraising Professionals’ newsletter, NonProfit Insights, cites the following benefits to implementing auto recurring giving programs:
- Fulfillment rates for pledges average 98%- as much as 50% higher than with mail-based monthly donor programs.
- Studies show that monthly auto-donors pledge 3 to 4 times more than one-time annual givers.
- Small monthly donations (that might previously have been rejected because of high processing costs) become cost-effective and can add up to a lot of money
- When donations occur automatically, the need for the nonprofit to persuade donors to ‘repurchase’ their commitment each month is eliminated
How can you implement an auto-recurring giving program?
The auto-recurring giving processes are easy to implement.
It enables the nonprofit organization to automatically collect a pre-set amount from a donor on any schedule (weekly, monthly, bi-monthly) using a single one-time authorization.
This can be done manually by the nonprofit after it receives written authorization from the donor, or the donor can set up the recurring-giving program himself using a form accessed from the nonprofit’s website. The payment can be made via credit card or via a direct debit from the donor’s checking account.
The system automatically generates an email receipt for the customer and copies the nonprofit. This is particularly important now that the IRS is requiring receipts for all donations, regardless of amount.
To enable this type of system, the nonprofit must be able to accept electronic payments.
Often a bank can provide a limited form of this service.
A better option is to subscribe to a “payment gateway” service that provides credit card and ACH direct-debit processing as well as a system for auto recurring giving. To maximize the effectiveness of your auto recurring giving program, make sure the payment gateway you select provides a secure online form where your donors can set-up recurring giving accounts themselves.
Lisa A. Hephner is marketing manager for PaySimple, which provides auto recurring giving programs includes low-cost ACH processing (direct-debit & e-check), credit-card processing and a secure online form, branded for customers, that enables online donations for groups with and without website.