Cancellation rates for Direct Debit donations remained at their lowest level for 13 years in 2015, despite the negative media reports and political criticism of some fundraising methods during the year. The public’s continued commitment to regular giving to charities will be revealed today by Direct Debit processing specialist Rapidata on the first day of the Institute of Fundraising’s National Fundraising Convention in London.
Rapidata has tracked trends in charitable giving by Direct Debit for 13 years. The past two years have seen the lowest cancellation rates so far for the whole of this period, according to Rapidata’s Charity Direct Debit Tracking Report 2016.
Public commitment to regular giving
The record low was achieved in 2014 with an average annual Direct Debit cancellation rate of 2.67%. But 2015 was the next lowest on record at 2.89%.
This was the first time that cancellations had fallen below the average annual rate of 3%, down from over 4% during the difficult times of the economic recession in 2008 and 2009.
The low cancellation rates do not appear to show any impact of the media coverage of criticism of some fundraising. Cancellation rates remained below average from May 2015 to March 2016 inclusive.
There was a more sustained peak of cancellations during the summer months of July to August 2015, but Rapidata say that this follows the expected pattern of the annual cancellation cycle. In addition, this peak was still below the average rate for that time of year. Following this peak, rates dropped again towards the year end to an all-time low for the month of November of 2.34%.
Low rates continued into 2016
2016 got off to a good start: the cancellation figure for January of 2.64% is the lowest rate for that month since the study began in 2003.
Of course, the still unclear results of the EU Referendum result could still have a negative impact on regular giving levels. Yet “all signs so far look positive”, according to the agency.
Trust in charities
Professor Adrian Sargeant, director of the University of Plymouth Hartsook Centre for Sustainable Philanthropy commented on the findings, saying:
“Despite the fundraising crisis last year, donors did not respond by cancelling their regular gifts in their droves. This is exactly the kind of evidence we should be using to inform policy decisions.”
Peter Lewis, Chief Executive of the Institute of Fundraising, welcomed the report, saying:
“The evidence in this report backs up what we have heard from our members – existing supporters are continuing to trust and support the charities they already give to. Charities will want to build on the fact that donors are sticking with the causes they support, doing even more to ensure donors’ needs are at the heart of how they fundraise.”
Scott Gray, managing director of Rapidata, said that the findings indicated that “we should not underestimate the strength of the public’s connection with the charities they choose to support.”
At the same time he urged that:
“the figures should be taken with caution as the last year has shown fundraising it cannot rest on its laurels. Whilst no long-term impact on regular giving from the fundraising crisis is good news for regular giving, we must note that the majority of media attention has been directed at recruitment channels – direct mail, telephone fundraising, sharing of data in prospecting – and that the importance of retaining and nurturing supporters has never been more important.”
Rapidata’s Charity Direct Debit Tracking Report will be available as a free download.
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