Direct debit cancellations rose sharply between April and May and remain significantly above last year’s rates, prompting questions about whether a new trend is emerging with regular giving.

Charity direct debit cancellations rose from a low 2.44 per cent in April to 4.1 per cent in May, with no apparent explanation for the soar, according to figures compiled by Rapidata.

Although cancellation rates did fall slightly in June (to 3.87 per cent), rising only marginally in July (3.91 per cent), these rates remain significantly above that of June and July 2011, when they sat at 3.21 per cent and 3.22 per cent respectively.

Somewhat ironically, May was when the government released its Giving White Paper designed to boost philanthropy and coincided with the release of Rapidata’s Charity Direct Debit Tracking Report, which found that 2010 cancellation rates had fallen to pre-recession levels, ending the year at 2.87 per cent. May also followed a series of bank holidays caused by Easter and the Royal Wedding.

Scott Gray, managing director of Rapidata, said the May rates “mirrored those seen in 2008 and 2009 in the depths of the recession”, but that at the time the company had written it off as “an anomaly”.

However, the recent months figures he said, “suggest an economic shift has occurred since Q1 2011, maybe reflecting the nation’s mood of economic uncertainty that has flared up again recently.

“I don’t think this is overly alarming just yet, but charities should be looking at their current activities and asking whether they are doing everything they can to minimise cancellations and attrition.”

Rapidata monthly monitoring figures

	April	May	June	July
2010	2.89%	2.80%	3.21%	3.22%
2011	2.44%	4.10%	3.87%	3.91%