5 easy ways that you can start lowering your cost of fundraising
When donors make a gift to a charity, they do so with the hope and trust that the charitable organization will use those funds as effectively as possible. This means avoiding unnecessary online fundraising administrative costs so that the dollars you raise will be maximized for the cause. Thankfully, there are simple steps you can take to lower costs and increase departmental efficiencies, thereby saving your organization valuable money and time.
Reduce Your Credit Card Processing Fees:
In many cases, registered charities are often able to benefit from a reduced credit card interchange rate (i.e. processing fee). This fee is a charge paid by merchants when they process payments by credit cards, and the fee is calculated as a percentage of the transaction value. A lower interchange rate means that a credit card transaction taking place on behalf of a registered charity would be charged a lesser fee than a transaction of equal dollar amount executed by a regular merchant, thereby saving the charity money that would otherwise pay the credit card company. Both MasterCard and VISA offer reduced interchange rates to registered charities – make sure you are taking advantage of the opportunity! If you think your organization is paying too much in processing fees, talk to a Giving Gateway payments specialist about how your credit card fees could easily be reduced.
Ask Donors to Cover Credit Card Processing Fees:
Donors want to know that their charitable dollars are being maximized. Since the credit card interchange fee is based on the transaction value, in many cases the amount charged will only amount to a few dollars (i.e. $1.50 out of a $100 donation). Donors may be happy to “cover the fee” by adding a nominal amount to their donation. Don’t be afraid to offer this as an option. Not every donor will say yes, but each time they agree to cover the fee you will conserve funds from your operating/administrative budget.
Avoid Missing Out on Payments:
Ensure that you have a system in place to notify monthly donors before their credit card expires. If you miss out on payments due to expired cards, you may have to write off part of the gift. Make sure this doesn’t happen by contacting your donor for updated information at least 60 days in advance of the credit card expiry date.
Mail costs money so the more that you can solicit on-line and issue digital tax receipts, the more you will reduce the associated costs. This means ensuring that your organization has a strong online presence and a user-friendly portal to encourage online giving. If you don’t yet have such a system in place, this needs to be your number one priority.
Invest in your CRM software and train your employees to use it properly:
Your database is key to your business; it houses donor contact information, payment details, and keeps track of how donors interact with your organization. If the database contains inaccuracies – such as misspelt names, out of date addresses, or duplicate accounts – it is costing your organization money. Invest in the best database management system you can afford and make sure that your staff are trained in how to use it for maximum efficiency.
By making small but important changes, you can make a big impact on your bottom line and deliver more dollars where they are needed most!