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Best Practices for Recurring Donor Receipts

Featured post by Erica Waasdorp-

Last year, proposed Mastercard regulations and deadlines for subscription provided quite the scare for nonprofits.

One of the regulations would have mandated providing recurring gift receipts every month — at least online. Another regulation would have required making it easy for the donor to find contact information on those receipts, in case the donor wanted to cancel or change their gift.

Some nonprofits were already following (most of) these rules because their payment platform or donor CRM was already following (most of) these rules.

The regulation that would have required nonprofits to offer donor portals so donors could update their recurring gifts would have been for certain the hardest to implement and surely would not have been ready in time by the March 2023 deadline.

A major reason why Mastercard wanted to implement these regulations was to prevent so-called chargebacks — or complaints from customers wanting their money back because they never meant to buy or donate.

Fortunately, nonprofits are typically good stewards of donors and they’re always trying to improve the relationship. The number of chargebacks in the nonprofit sector is minimal. Thanks to the The Nonprofit Alliance and numerous nonprofits providing their chargeback numbers, Mastercard was able to make nonprofits exempt from having to follow all of these regulations.

Now that things have settled down, let’s step back for a minute.

The reality is that it does not take much for donors to complain. And if one organization pushes the envelope, causing donors to complain, that could have an impact on the whole industry. Just remember what happened in the UK with that one donor, which triggered GDPR guidelines that are now making it much harder to acquire new donors and make communication with existing donors harder.

That’s why it’s always a good thing to be as transparent as possible to your donors. So here are my top five best practices when it comes to recurring gift receipts.

1. Send Personal Receipts to Your Recurring Donors

Sending receipts can certainly be a good thing if you try to make it less about the transaction and more about the impact the donor’s recurring gifts are making.

Sometimes you don’t have a choice. Sometimes the monthly gift receipt your platform spits out looks exactly like a receipt and you can’t customize any of it. If that’s the case, at least make sure that you have your contact information on the bottom of it.

2. Include Your Contact Information in Every Receipt

You can make it a simple one-liner on the bottom of your receipt — i.e., if you have questions about your gift, contact [name] at [phone number] or [email address].

This way, the donor knows whom to contact if they do want to change, upgrade, downgrade, pause and, yes, even cancel their gift. There’s something magical about having that contact information in your receipt that gives the donor the feeling that they have an out if they need it, which will help them trust your organization more than if that information were not there.

Sometimes, you can customize your receipt to include a story. That’s great. Ideally, that story should be above the receipt. Telling the donor how their recurring gifts are making a difference is always a great thing.

3. Regularly Test Your Online Receipts

Payment platforms and donor CRMs are constantly changing and updating their forms, services, automations and receipts. I’m presuming that someone in your organization is monitoring those updates, but if not, test your receipt process and messaging at least once a year — but preferably even more often.

4. Send Each Donor a Hard Copy Thank-You Letter After the Initial Gift

Unless donors specifically ask not to receive anything by mail, sending them an initial thank-you letter that includes your contact information (see best practice No. 2) is a great first step to the recurring donor relationship — no matter which channel prompted them to give the gift.

In that initial thank-you, you can indicate that they’ll receive regular receipts online for example. You certainly do not need a hard copy thank-you letter every month unless a donor asks for it, but you can let them know that they’ll instead receive an annual overview every January/early February.

5. Send an Overview of All Gifts for the Calendar Year

You can send a tax letter by email and/or mail. It depends on your preference, your platform’s options and, of course, if you have email addresses on file for your recurring donors. If in doubt, send a tax letter by both mail and email. Do not include any donor-advised fund gifts in those totals. It’s also great if you can include a story — even better if you can personalize it, too (hint, scanned messages can look great).

There you have it — my top 5 best practices for gift receipts.

If you let your donors know how their recurring gifts are making a difference and you’re giving them other updates outside of the receipt times, you should be able to create that ongoing relationship that’s going to help retain as many recurring donors as possible.

Erica Waasdorp writes, edits and advises various direct-marketing and national and international fund raising publications. She has written various articles about monthly giving, international fundraising, fundamentals of fundraising, writing and answering RFP’s and many more. Connect with Erica or read more about her by going to her website

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