Why Monthly Donations Are Important for Your Non-Profit?
There’s a reason why monthly donations are important for your charitable organisation. No matter what size or growth stage your non-profit is currently at, having a great monthly donation program is vital for your long-term success. In fact, among all the various factors that decide your organisation’s fundraising strategy, maintaining a regular stream of funds from your passionate donors ensures that your cause gets the attention it deserves and creates a wider impact.
What are Monthly Donations?
In the fundraising world, there are different types of gifts. One-off donations are those amounts that are given a single time, maybe in the donor’s lifetime or in unpredictable frequencies. Major donor gifts are large funds gifted by affluent philanthropists to charities.
Major donor gifts are substantially larger than your average one-off donation but they are also less frequent and require a higher degree of effort and communication to maintain a relationship with a high net-worth individual.
There are also in-kind gifts – namely resources such as medicines, provisions, office space etc that are non-financial contributions.
Monthly donations are basically funds that are gifted regularly – every month – by a section of your donors (called regular donors). Most NGOs around the world raise a substantial part of their budget through monthly donations. But this is not the only reason why monthly donations are important for your NGO.
Apart from sustainable revenue, monthly donations also are great indicators of how many people actually believe in your organisation’s cause, which helps in building a close-knit community around your cause.
How Monthly Donations Help Your NGO?
One of the main objectives of direct dialogue fundraising is to get people to regularly donate – preferably on a monthly basis, although quarterly and annual plans also exist. Securing monthly donations is also possible with other fundraising methods such as online or through tele-calling.
Non-profits are always bidding to stretch every rupee to create the highest impact on the world, making monthly donations to your best friends. There are multiple reasons why monthly donations are important for your non-profit organisation.
Raise More Funds
Around the world, reports indicate that regular givers contribute more than one-off donors. This is not because NGOs use fraudulent means but simply as a result of sustained giving. For example, imagine you have only 1 regular donor who contributes Rs. 500 each month and a person who contributes Rs. 5,000 as a one-off donation. At the end of a year, who would have given more? The regular donor would have given Rs. 6,000 through monthly donations while the one-off donor would most likely not have equalled his past gift. The power of compounding is a major reason why monthly donations are important for your NGO.
Form Strong Relationships
Monthly donations help build strong links between a non-profit and its supporters. When a donor signs up for your monthly giving program, they stay loyal to your non-profit’s cause and you don’t have to ask them again and again for funds. Instead, your non-profit can focus on stewarding them through enriching communications about your cause and make them feel valued for their regular contribution. Donors making monthly donations also have lower attrition rates.
Stable Financial Base
The biggest reason why monthly donations are important is that they allow your NGO to be confident of a certain amount of money coming in regularly. Your organisation doesn’t have to worry much about when the next donor cheque is going to arrive. This predictable source of income allows you to focus on mobilising activities related to your cause in the real world.
Lower Fundraising Costs
Fundraising is an expensive activity. Globally, non-profits know that the cost of acquiring new donors is several times greater than the cost of retaining already existing donors. Monthly donations ensure that the amount of money that your non-profit would otherwise spend on recruiting, training and managing fundraisers to find new donors is mitigated. Even if you account for a general attrition rate of 20% every year, monthly donations provide you with the most bang for the buck spent on your organisation’s fundraising efforts.
How Monthly Donations Help Your Donors?
Much has been written about how monthly donations can work wonders for your charity’s operating budget and overall growth. However, the beauty of monthly donations makes it an absolute win-win situation for your passionate supporters as well.
The prime reason why monthly donations are important for your donor is the convenience involved in processing automated payments. Monthly donors don’t have to remember to send a cheque every month. Most banks in India have switched from ECS to NACH (National Automated Clearing House) these days, which means that your donors’ details are safely and efficiently used for transactions. Monthly donations also make less of a dent in your donor’s budget when compared to a large annual donation, since donations are split across 12 months.
Regular donors traditionally receive less asks in a year as compared to one-off or major donors. Instead, your NGO can focus on producing compelling content and communication materials that update your regular donors on your organisation’s progress. As dedicated supporters, their crucial role in helping your organisation achieve its goals must be recognised through genuine “thank you” notes as well.
Since regular givers do not get any tangible benefits for their contribution, why not send them an occasional gift that will help keep your relationship strong? Many global non-profits believe in making their monthly donors feel special by sending them small gifts such as a keychain or bumper stickers. Such special gestures make your valuable supporters feel like they belong to an exclusive community of Samaritans.
The chance to Witness Results
Say your NGO works for the upliftment of underprivileged children by providing them access to good education. You have a large set of monthly donors who have sponsored your work over the years. Why not invite them to an interactive session with the children whose lives they helped change?
Witnessing actual results (that they helped achieve) is one of the most emotional experiences your monthly donors can have. By including such interactions for your monthly donors, your NGO can help them understand the positive consequences of their contribution while forging deeper, emotional bonds with your organisation’s mission.
Monthly donations can be very beneficial for NGOs, especially if yours is a small and upcoming organisation. The initial investment may be on the higher side to acquire donors, but in the long run, monthly donations hold the promise of supporting your non-profit with the financial resources necessary for your campaigns and objectives.
Not all monthly giving programs need special branding but they definitely require systematic planning and effort. Your non-profit also needs to have a donor retention program in place before looking into seeking monthly donations.
We, at Direct Dialogue Initiatives India, know why monthly donations are important and how they make a massive difference in achieving your non-profit’s mission. As a professional fundraising organisation, we work with non-profits of all sizes and provide a wide gamut of services that include donor enrolment, retention, mobilisation, marketing, high-value donor cultivation and donor database management and analytics.
DDII develops fundraising strategies and services after discussing your non-profit’s overall objectives. We believe in empowering your NGO with the right fundraising tools and plans to help you make the world a better place.