Direct debit cancellation rate rose slightly last year

According to a report from Rapidata, the proportion was 2.9 per cent, up from 2.7 per cent in 2014

Direct debit cancellation rate up
Direct debit cancellation rate up

The cancellation rate of direct debits to charity rose slightly in 2015, new figures show.

A report from the direct debit processing company Rapidata, published today, shows the proportion of charity direct debits that were cancelled over the course of the year was 2.9 per cent, up from 2.7 per cent in 2014.

But Rapidata said the figure, which is based on more than 7.4 million direct debits totalling more than £66m of donations, was the second-lowest cancellation rate since the company started collating figures in 2003, and was the first time the figure had risen since 2011.

The 2015 cancellation rate was well below the peak of 4.3 per cent reached in 2008.

The report says the data shows that the effect of the negative publicity about charity fundraising last year has been limited and early signs were that 2016 would be a good year, with January recording the lowest level of cancellations for that month, at 2.6 per cent.

"The media exposés and negative publicity about charity fundraising practices may have damaged public trust in charities to some degree, but there was no sustained spike in direct debit donation cancellations," it says.

The report, called Rapidata’s Charity Direct Debit Tracking Report 2016, also reveals that the proportion of "no-shows", or people who cancel direct debits before any payments are made, rose from 11.5 per cent in 2014 to 12.2 per cent last year.

But it was lower than the 13.3 per cent it reached in 2013.

Scott Gray, managing director of Rapidata, said the strength of the public’s connection with the charities they chose to support should not be underestimated, with the large majority of supporters continuing to give.

But he warned that "the last year has shown fundraising it cannot rest on its laurels".

He said: "While 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."

Professor Adrian Sargeant, director of the University of Plymouth Hartsook Centre for Sustainable Philanthropy, said in a statement about the figures: "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."

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