Regular Giving Declines

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By Kate Burtt, Retention Executive – Individual Giving, Starlight Children’s Foundation

When starting out, or working to improve, a regular giving program, it’s easy to focus on ‘big ticket’ items – channel, pitch, product, acquisition targets, choice of supplier etc. We often miss important opportunities for improvement by not paying close enough attention to the details.

Declines management is an excellent example. Benchmarking shows that if we breakdown the number of RG payments received in 2022, 89.5% of monthly donors made 12 payments, and 83.35% of 4 weekly made 13. While declines may seem ‘incidental’, failure to effectively manage this area of your program can significantly impact your organisation’s annual regular giving income.

A robust declines management program is critical to optimising your regular giving income and managing the payments of your active donor base. It will also reduce the number of donors who attrite due to failed payments. Here are six top tips for managing declines in your Regular Giving program:

Tip 1: Know your payment providers.

  • In many organisations, payments are completed through the finance team so start there if you are unsure.

  • They may be the same or different providers for credit card and direct debit payments.

  • Ensure you know who the account manager is in your organisation and at your payment provider(s), so you can raise issues if required.

    • Tip 2: Get a list of payment decline reasons from your provider(s).

  • This will be available from your account manager or online.

  • The list will include response codes, response descriptions and suggested actions.

  • Your payment provider will send a response for each transaction attempt made.

    • Tip 3: Ensure these reasons are coded into your database.

  • Your team will need to understand the difference between ‘hard’ and ‘soft’ declines.

  • ‘Hard’ decline reasons will not result in any further payments being made to you by your donor.

  • ‘Soft’ decline reasons can be retried, resulting in possible payments from your donor.

    • Tip 4: Create a business rule for the number of reattempts you will try in a monthly payment cycle for your soft declined credit card donations.

  • This will differ in each organisation depending on your processes and systems but try as many as possible that still allows time for communicating with donors that have failed after your final reattempt.

  • Test your reattempt number by small increases to see if you are still receiving funds eg if you are doing 5 retries a month now, what happens if you try 7?

    • Tip 5: Create a business rule for how many consecutive failures you will allow a donor to have before cancelling their gift.

  • Most organisations allow 3-4 months of failures in a row.

  • Also know your business rule for when they will become eligible for reactivation campaigns from either their cancellation date or last successful payment date.

  • DO NOT retry failed direct debit donors. If their failure reason is a hard decline, consider immediately cancelling their regular gift after trying to contact them if you don’t get updated details.

    • Tip 6: Consider your communications to declined donors.

  • This can include telemarketing, SMS, email and/or mail.

  • Allow enough time for the communication to be completed in time that your team can receive the response and update any details before your next monthly pledge cycle.

  • Consider testing your communications channels for effectiveness and cost to see what works best for your organisation.

    • If you would like to further discuss declines management, please don’t hesitate to reach out to Kate via LinkedIn: https://au.linkedin.com/in/kateburtt