Is Setting Up a Direct Debit a Cost-Effective Way of Giving?

Direct debits are another popular way to donate regularly – 61% of Which? members who give to charity on a regular basis do it this way. They are easy to arrange – just give your chosen charity your details and they will set up the monthly donations from your bank account.  For larger charities, you can often set one up yourself online.

Many people donating via direct debit are initially signed up via street and door-to-door fundraisers – ‘chuggers’ as they are sometimes known as.  This method of fundraising can often raise hackles, as some people find it intrusive or question whether it is a good use of charity money.

The Public Fundraising Regulatory Association (PFRA) report that the cost for a charity of recruiting a donor via door-to-door or street fundraising is typically £75-£140.  If you were to donate £5 a month, it might take more than two years for the charity to recoup this – so, on the face of it, it does not look a particularly effective way to give, especially if you switch causes periodically.

The PFRA, however, say that it is an effective way for charities to fundraise.  Its spokesman said that in whatever way a donor responds to an appeal from a charity, there will be a period of time before the amount the donor gives covers the cost of what the charity spent to get the donor to give in the first place. 

But the key message is that, if you want you money to go further, cut out the middleman and set up the direct debit yourself.

 

[Taken from Which? Magazine, December 2013]