The benefits of Direct Debit services for charities

Advantages of charity Direct Debit

Direct Debit offers significant advantages as a payment method for any sector – commercial, public sector, and the third sector. In this post, we look specifically at the third sector, and how charities and non-profit organisations can benefit from using Direct Debit.

Donor retention

It’s a fact that many households are feeling pressed financially in the current climate. Charitable giving is often one of the first casualties of more stringent budgeting as households rein in their expenses. Offering easy ways to donate, such as by regular charity Direct Debit, is a vital part of retaining donations wherever possible.

Certainty

If you’re receiving donations by Direct Debit, you will have a greater overview of how much you will be receiving. Direct Debit donation gives greater certainty, allowing you to budget and plan more effectively.

Advantages of Direct Debit donation over Standing Orders

We covered the relative advantages of Direct Debits over Standing Orders for charities in a previous blog, and our analysis still holds true. For a number of reasons, including the Direct Debit Guarantee which protects donors, Direct Debit donation is a better solution for charities when compared with Standing Orders.

Reduced administration costs

On average, it costs 25p to raise £1 in voluntary donations, so reducing that 25p to as little as possible is very important for charities, ensuring that the maximum donation goes to the cause itself. A charity Direct Debit typically costs less to administer than debit or credit card transactions, and avoid the costs associated with processing cash and cheque donations, because Direct Debit donation can be automated.

Reporting

As accountability – and particularly financial accountability – becomes more and more important, the Bacs reporting that Direct Debit offers is a huge advantage to charities and also helps with keeping administration costs down.

Of course, it’s all very well looking at the advantages for charities, but what about donors? Fortunately, Direct Debit donation offers donors – and potential donors – a number of advantages, too.

Advantages of Direct Debit donation for donors

Familiar territory

Nine out of ten adults make at least one regular payment by Direct Debit – and 73% of household bills are paid this way. As we increasingly move to an online society where donors and potential donors want life to be as easy as possible, Direct Debit is a tool that is already familiar to many people. Using it to make their charitable donations makes sense.

Popularity

Direct Debit donation is already a popular way of supporting charities – second only to cash donations, Direct Debit already accounts for over 30% of charitable donations.

Convenience for donors

The statistics we’ve quoted above highlight the underlying benefit of Direct Debit in today’s society – Direct Debit is a convenient and hassle-free way to make a regular payment. For the donor, it means they can fulfil an intention to donate – be that monthly or annually – without having to remember to do so.

Implementing Direct Debit services for charities

Investing in a new system may seem daunting, and might feel like an unjustified expense. However, the benefits of using Direct Debit services for charities are clear, and if your charity hasn’t already done so, it’s well worth taking the time to explore the possibilities of Direct Debit donation so that your organisation can take advantage, too.

Speak to us today if you want to know more – we can help you set up your Direct Debit donation system and even manage it for you via our Direct Debit Bureau Service, meaning you can relax and focus your attention on what you do best.