Levels of regular giving are beginning to return to “more normal” levels following “anomalous” year for the sector in 2016, according to figures published today by Rapidata.
According to Rapidata’s Charity Direct Debit Tracking Report 2017, published today to coincide with the first day of the Institute of Fundraising Convention in London, last year “saw the lowest annual direct debit cancellation rate on record” but said this was likely an anomaly “driven more by a decrease in fundraising activity than a rise in donor retention”.
The figures show that the average annual cancellation rate for 2016 was just 2.61 per cent across the year, the lowest figure since Rapidata began benchmarking the figures in 2003.
With the levels of fundraising activity beginning to increase at the beginning of this year, the report showed that cancellation figures for the first quarter of 2017 have broadly returned to what the report calls “normal figures”, with the rate hovering just under 2.9 per cent.
Growth in numbers 'signing up to direct debit online'
For the first time, this year’s iteration of the report also tracked online regular giving through charities own websites. The data showed a 7 per cent annual growth in “the number of donors signing up to a direct debit online”.
The figures showed also that donations made via desktop computer were “highest value”, with the average computer donation being £13.75, 24 per cent higher than then £10.49 average donation made by mobile phone.
Scott Gray, chief executive of the direct debit processing company, said: “During the difficulties of 2015/16 we saw many charities carrying out less fundraising activity; anecdotal evidence tells us many were holding back while seeking clarity around changes in best practice and regulation before adjusting their fundraising practices.
“Fundraising reforms are now being felt and our sense is that the sector is starting to feel more confident and stable, with fundraising activity being reenergised.”
Rapidata calls for ‘recommended charity industry standard’ for cancellation rates
Rapidata have also used the report to call for the sector to adhere to what it calls “the 3 per cent cancellation average benchmark (CAB)”.
The report said that Rapidata “believe that any charity whose cancellation rate rises above 3 per cent for any given month, aside from exceptional reasons from within the charity sector, should review their supporter care programmes and strategic operations, with the aim of reducing and improving this rate”.
Gray said the CAB benchmark was based on fourteen years of direct debit analytics gathered by the company and represented “an achievable rate for most charities”.
Peter Lewis, chief executive of the IoF, said: “In broad terms, I welcome the idea of the sector-wide cancellation benchmark proposed in this report that charities should aim to stay below. I look forward to the discussions around this and encourage others to join these on how this might be taken forward.”
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