Coronavirus: Pandemic causes jump in cancellation of direct debit donations

UK charities are experiencing a drop in regular direct debit donations as a result of the covid-19 pandemic, new figures have shown.

Figures released by Rapidata show the rate of direct debit donation cancellations has increased from 2.16% in February to 3.09% in March, the ‘biggest swing every recorded’.

The cancellation rate for March this year was 41% higher than March 2019, when the rate stood at 2.19%, but was lower than the 2008/09 recession, when the direct debit cancellation rate soared to 4.33%

Rapidata’s findings revealed the majority of direct debit donations were cancelled in the last two weeks of March, correlating with the introduction of social distancing and the subsequent UK lock-down.

Additionally, the number of new donors for March was just under 25% lower than the same month last year, accelerating during the last two weeks of the month at 58.17% lower than the same period in 2019.

IoF head of policy and external affairs, Daniel Fluskey, said the rise in cancellations exemplifies how chal-lenging the current crisis is for charities’ incomes.

“Many of the most committed and generous supporters are having to cancel donations and the lim-its on social contact mean that charities are unable to deliver much of their fundraising activities. As a result, frontline charitable services are heavily at risk both now and in the future, which is why we ur-gently need a package of support from the government,” he said.

A recent survey revealed charities are expecting a 48% fall in voluntary income as they expect many supporters to be fearful for their own financial situations.

“While it’s an incredibly challenging environment for fundraising, we are seeing some remarkable acts of generosity and responses to emergency appeals – showing that people can and will still give, though perhaps in different ways and levels than in recent years,” Fluskey added.

Rapidata lead, Scott Gray said it remains to be seen whether lockdown measures caused an ‘incidental spike’ in cancellations, or whether cancellations will continue to build along with the pandemic.

“Almost three quarters of charities fear going bust without financial support; the real worry for the public is of course the end of the vital services and assistance those charities provide. Anecdotally we’re hearing of positive results being reported across digital and telephone fundraising, but with most charities expecting more losses the reality may mean a higher rate still for April,” he said.

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