The Power of Recurring Giving

By Heather Burton, Sage Nonprofit Solutions

Many religious organizations have been faced with shrinking congregations yet increasing demand for the services they provide to the community. This translates to fewer dollars to spread among a higher need. With many people tightening their belts during these rocky economic times, establishing or formalizing your recurring giving program may be the answer for your church.

 

What are recurring giving programs?

In its simplest form, a recurring giving program is nothing more asking people to commit to donate a set amount of money at consistent intervals with no defined end date. Typically, these programs are managed by using electronic fund transfer (EFT) from a person’s credit card, debit card, or checking account, and a donor management or constituent relationship management (CRM) system. It is very similar to setting up an automatic bill pay with your local bank. Sometimes these programs are referred to as monthly giving programs, sustaining gift programs, or have a special name specific to the organization or the donors, such as “partners in faith.”

 

Why do recurring giving programs work?

In order to understand how these programs work, let’s look at a simple example. Sally Jones donates a total of $1,000 to 10 causes each year, including your church. Two of the causes have recruited Sally into their monthly giving program at $10 per month, leaving $760 for the remaining eight causes. Does Sally split the remaining donation amount among the eight, or choose to forgo a cause this year, especially in the tightening economy? And for the two organizations who recruited Sally into their program, their gift has just increased from $100 per year – assuming Sally would have divided her $1,000 evenly among her 10 chosen charities – to $120 per year.

 

Glenn Stephens, CPA, and CEO of ProSoft Solutions in Highland Village, Texas, a consulting firm serving ministries and nonprofits, says many of his ministry and nonprofit clients have had tremendous success with recurring giving programs. ”Clients have been able to raise more money, establish a much more stable revenue stream, and simplify their fundraising efforts,” he says.

 

In the case of First Presbyterian Church (FPC) in Albuquerque, N.M.,, a recurring giving program has been an essential part of operations since it was established in 1881. “Without a recurring giving program, we couldn’t operate,” says Sam Mayer, FPC’s finance administrator. “We wouldn’t be able to maintain the religious programs and activities, or maintain the paid staff to run our ministries. It would be a nightmare of a guessing game.”

 

FPC refers to its recurring givers as “Pledging Households.” Mayer says, “When the congregants RSVP or pledge an amount per week, month, or year to the Church, we know how much we can budget, grow or cut back, or otherwise adjust our Church activities.”

 

Common Misconceptions

Some organizations never start a recurring giving program, or do not take their current program to the next level, because of misconceptions about either their congregation or their church’s ability to process the gifts. Common misconceptions include:

• “It won’t work with our congregation because….”;
• “It’s doesn’t add up to a significant amount of money;” and
• “It will take too much time, effort, and resources.”

 

”Often, our clients to have initial concerns related to recurring gifts,” says Stephens. “For some contributors, it is a new concept that simply needs to be explained. That’s why we’ve found that communication is key . It’s vital that church leadership clearly communicate to their congregations that it’s an easier and more convenient way to give. It’s also extremely safe if churches have the right security measures in place.“

 

If you are experiencing the previously mentioned objections in your church, there are ways to overcome the concerns. Most importantly, arm yourself with facts. Look to other organizations that have implemented recurring giving programs, and find resources on recurring giving.

 

Second, ensure that you have the technology in place to help streamline the process. This includes both payment processing capabilities and a constituent or donor management system.

 

Finally, do not hesitate to engage a consultant or partner, if necessary. They can help you to educate your congregation about the program, create support cases, and even help with evaluating your technology.

 

Getting started or taking your program to the next level

Like any other initiative your church undertakes, an evaluation of the current situation is essential. This will help you develop a plan to best reach your congregation and ensure your program’s success.

 

1) Analyze WHAT your program consists of today.  Ask yourself these questions:

·         Do we already make recurring giving an option for our members?

·         If so, what frequency? What price?

·         Do we need to send invoices?

·         Can people sign up online?

 

2) Understand WHO is in your program today. It’s important to understand how many people are in your current recurring giving program, as well as their demographics, relationship with the church, and involvement in the program. If possible, find out about their experience with other recurring giving programs. By profiling your existing recurring giving donors, you will be more successful in moving additional members into the program.

 

3) Evaluate your “back-end” TECHNOLOGY. This point cannot be stressed enough. By doing a quick technology audit, you will be able to determine what infrastructure you already have, as well as what you may need in order to minimize your staff’s efforts. Ask yourself:

·         Do we accept credit cards and bank withdrawals? Should we?

·         Do we have ways to protect donor’s sensitive data?

·         How will we track our donors?

·         Do we thank donors promptly?

·         How will we address individual concerns?

 

Stephens says, ”Our culture has embraced the technology required for a successful recurring giving program. Religious organizations must realize that many of their members already use recurring payments for various expenses and donations.”

 

4) Start SMALL. No matter where you are in your recurring giving program, adjustments are often necessary. Build your program into existing activities or natural requests for funding to help minimize any potential distraction from your core operating activities.

 

5) COMMUNICATION is key. You need to carefully plan the communication of your program, especially if you are just starting out. All of your evaulation work comes into play when communicating your recurring giving strategy and gaining agreement from leadership.

 

Next, you need to execute on educating your congregation about the program to start recruiting participants. Design simple, clear, and easy-to-understand ways to communicate your messages, and be sure to explain the benefits of joining the program. How will the gift impact the donor? How will it impact your church and the community it serves?

 

6) Take a TEST drive. Whenever you make changes, whether it is to the marketing of your program or to the technology used to process gifts, perform a test. Were the changes beneficial? Is the program better than before?

Testing helps make for a stronger “ask” of your larger congregation, and helps ensure that your processes are working and efficient.

 

If You Build It, They Will Come, Right?

Recurring giving programs are not a one-hit wonder, and do not generate income instantaneously. Like any other fundraising initiative, they take time and cultivation. You can help ensure your church’s success by committing to a recurring giving program, embracing technology to help simplify the processing, setting realistic fundraising goals, and implementing changes in ways that are sustainable for your church.

 

“Our experience, without exception, is that when organizations implement a properly planned and designed recurring giving program, they are extremely happy with the long-term success,” says Stephens. “We have never known any of our clients to terminate their program after starting it. All have been successful.”

 

Mayer adds, “We can’t always ’step out in faith‘ as we’d like to, particularly in difficult economic times. I can’t imagine a Church of any size being able to run their ministry without a recurring giving program in place.”

 

Heather Burton is senior marketing manager for Sage North America’s Nonprofit Solutions, including the Sage MIP Fund Accounting and Sage Fundraising products. Previously, Burton worked in various development roles at several nonprofit organizations. She is currently board president-elect for a nonprofit organization in her local Austin, Texas, community.

Glenn Stephens, CPA, is CEO and Owner of ProSoft Solutions

http://www.prosoftsolutions.net/