How small charities can take credit card donations

A new report by the Charities Aid Foundation raises concerns that cash donations are falling sharply as credit card payments and regular direct debits become more common. A 22% drop in cash donations, coupled with a predicted fall in charitable income on the back of the credit crunch is seen as a particular threat to smaller charities - in other words the vast majority of organisations supported by CVS and other infrastructure bodies in local networks across the south east.

Given the costs involved most small charities will not be able to afford to set up credit card payments, but there are several online systems which could help avoid the worst effects of this change. Here is a quick round of three of the best known and ideas about how to use them.

The best known of these is Just Giving, which is very commonly used by people entering large public events, such as the London Marathon, to enable supporters to send their money straight to their chosen cause. Any charity can set up a page on the site, and it currently offers a free 3 month trial, after which it charges £15 per month and 5% per transaction BUT it also adds on Gift Aid when UK resident donors fill in the form provided. They reckon they can turn a £10 donation into about £13.

They have a handy video to explain the concept:

Justgiving Fees - Explained in Video! from Justgiving on Vimeo.

Similar services are available through Charities Aid Foundation's eFundraising service, which includes listing on the CAF website, and www.bmycharity.org.uk, which offers a free Pay As You Go service. This gives you slightly less for each donation but is an ideal way to get started.

Fundraising plans and online promotion

Of course setting up an online payments system in this way is not going to solve anyone's funding problems unless it is part of a more comprehensive fundraising plan. You need to think about who you think will donate to your cause, how you will communicate with them and then find as many ways as possible to advertise and link to your new payments page.

This may include adding a bog to your web site - using Blogger or Wordpress.com for example - or investigating Facebook groups and other new forms of networking to raise your profile and connect with supporters. This may mean a steep learning curve at first but, given the potential financial benefits, and the relative ease with which you can set up payment systems it is definitely a good first step to addressing a significant trend.

A final point is that none of these systems is of any use if you don't have a charity number. Unconstituted groups, social enterprises without a charity number or other organisations will probably have to use PayPal or an equivalent online payments service. There are many services such as this, with all sorts of charging structures, so more research is needed to see which one fits your needs.

Read about trends in giving

Third Sector magazine has a story about the findings of the research and details of the changing patterns in giving at Massive decline in cash giving 'a threat to smaller charities' - Third Sector

Tags: fundraising, ictchampion, scipnews