Finding the right payment solution to support your fundraising organisation can be a daunting task. With these tips, I aim to help you identify the most important criteria for your organisation that you can include, for example, in a Request for Proposal.
Tip 1: Identify short vs. long-term goals.
Do you have specific, urgent payment management problems to solve, or are you looking for something that supports your strategic goals over many years? Maybe you need both. Whatever the circumstances, when selecting a payment solution, I recommend identifying both short and long-term requirements and communicating them to potential solution providers.
Tip 2: Look for CRM integration.
With digitalisation comes personalisation. Just about every aspect of our lives has some degree of personalisation nowadays. As a result, the modern donor experience is no different: they expect a personalised experience interacting with your organisation.
A CRM solution is the fundamental building block of personalised experiences. Without CRM, it is nearly impossible to keep track of your individual donors and communicate with them on a personal level.
The advances in Financial Technology (FinTech) over the last years is also forcing us to rethink the role of payment data in CRM. Knowing what channels your donors are using to communicate is only part of the story. To complete the personalised donor journey, you will also need to know (and support) the donor’s preferred FinTech.
A payment solution should be able to add payment data to your CRM natively, meaning the payment data is not only viewable but also actionable (e.g. for automation, reporting, etc.). Real-time data integration also enables time-sensitive donor communications, for example.
CRM integration selection criteria:
- Does the payment solution automatically add the payment data to the donor profile in CRM?
- Is payment data available in real time?
- Is payment data actionable, like for triggering automated messaging?
Tip 3: Plan for adaptability.
With the constant rise of new FinTech & changes in payment related regulation, like Apple Pay, Google Pay, QR code based mobile payments, Open Banking & PSD2 to name a few, a payment solution needs to be ready for change. With this rapidly changing payment landscape in mind. It is important that your payment platform allows you to unlock new FinTech to your donors without significant impact on your IT architecture. Choosing a new payment capability to embed in your fundraising flows should be a business decision, not a technical one.
With a range of FinTech providing payment data, it becomes paramount for the payment solution to work with that data in transparent, yet generic ways.
Adaptability selection criteria:
- How does the payment system handle adding or removing new payment technologies & methods?
- Does the payment system support common workflows that are applicable no matter what FinTech is used?
- Does the payment system unify payment data from all payment sources and methods for reporting, dashboards, etc.?
Tip 4: Demand data quality.
Big data and data-driven processes emphasise the criticality of a sometimes overlooked factor: data quality. Data management is not easy, so it is very important that your payment solution safeguards payment data quality the same way CRM does for your other donor profile related data. Here are some of the most critical data requirements for payment management:
Data quality selection criteria:
- Does the payment solution support deduplication (including custom deduplication)?
- Does the payment solution support validation on the data requirements for the used payment methods, including bank account and mandate validations.
- Can the system manage data reconciliation, such as matching bank statements to payment data using configurable rules?
- To avoid duplication of data, can the matching and reconciliation system read the required information from your standard or custom CRM records, objects and fields?
Tip 5: Evaluate multi Payment Service Provider support.
With the diversification of the payment market, there are many Payment Service Providers (PSPs) to choose from, and there is significant variance in preferences across demographic and geographic groups.
A modern payment solution really must be able to use multiple PSPs. Each PSP potentially supports several payment methods, so the range of payment journeys is quite significant. Multi-PSP support should not add to your management overhead. On the contrary, it should help you minimize transaction costs while enabling you to offer a broad range of payment options.
Multi-PSP support selection criteria:
- Are your and your donors’ preferred PSPs supported?
- Are your and your donors’ preferred payment methods supported?
- How are PSPs and payment methods added (and removed)?
Tip 6: Establish the payment standards.
Both international and regional standards play a big role in the payment landscape. Even though there are standards like SEPA that cover several countries, there are still local regulations that impact how you manage payments.
Consider direct debit: it is a popular, widespread payment method for collecting donations and retaining donors, there are local direct debit variants for each country that need to be supported. Also consider bank transfers and standing orders, to effectively collect those types of donations in any particular country, you need to be able to work with a local bank in that country. That, in turn, means you need to be able to support the local standards and file formats used by that bank.
There may also be local financial instruments you can utilize to increase your fundraising. An excellent example is the Gift Aid program in the United Kingdom that allows donors to contribute taxes to nonprofits. Gift Aid has been shown to increase nonprofit donations by as much as 20%.
Payment standards selection criteria:
- What standards in which countries are supported?
- How are new countries and payment schemes added?
- Which direct debit schemes and file formats (including variants) are supported?
- Which bank statement and reporting formats can be processed?
- What local financial instruments are supported?
Tip 7: Integrate crowdfunding and peer-to-peer fundraising.
Crowdfunding and peer-to-peer (p2p) fundraising are highlighted here as a unique FinTech sector because they are increasingly important. Many organisations already use multiple crowdfunding and p2p fundraising platforms concurrently. Given that it’s sometimes not even up to the organisations preference, but rather the donors choice of platform (such as GoFundMe for instance), I expect this trend to continue for years to come.
These platforms generate a lot of relevant payment data that should help you enrich your 360° view of your donors. Getting that data into your CRM is a job for your payment solution. This ensures your full breadth of payment data remains ordered and consistently managed (i.e. good data quality) and gives you a complete picture of each donor’s giving activities.
Crowdfunding and p2p fundraising selection criteria:
- Can the payment solution integrate data from external sources into the core CRM data model?
- Which p2p fundraising and crowdfunding platforms are supported out of the box?
- Reporting capabilities to report on payment source channel (which p2p platform, which payment method, etc.)
Tip 8: Check security and availability.
Handling payment data and customer information is a high-security, high-availability undertaking. Few organisations can handle disruptions to payments, and no one wants to see security breaches.
Every aspect of the payment journey needs to be secure, and you need to be certain that it is available, both for your internal business process and for spontaneous donations.
Your CRM platform should go a long way in providing the fundamentals of security and availability. But no system is beyond failure, so beyond getting a rundown of the relevant features, your payment solution provider should be able to provide an array of information and communication about mitigation and response plans when something does go wrong.
Security and availability selection criteria:
- Can the solution provider provide a documented track record on system availability and security?
- What are the mitigation plans and communication protocols for service status and security incidents?
- What authentication protocols (like 2-factor authentication) are supported?
- Does the solution support fine-grained control over data visibility for different user groups?
Tip 9: Confirm compliance.
A payment solution must fit your compliance framework as well as specific financial requirements. This typically includes compliance with the Payment Card Industry Data Security Standard (PCI DSS), local accountancy standards and reporting requirements, to name a few.
Because payments deal with personal data, operating within the EU means the payment solution must comply with GDPR. Local regulations might impose additional requirements on processing, storing and reporting payment data as well.
For example, to process Gift Aid claims in the UK, you must be able to make and store the connection between each donation and the resulting Gift Aid claim record. In the Netherlands, the RJ 640 guideline for financial annual reporting by nonprofits outlines specific reporting requirements for on donation data.
Compliance selection criteria:
- Is the payment solution GDPR compliant?
- How does the payment solution handle PCI compliance?
- With what local regulations does the payment system comply out of the box?
- What is needed to implement all regulation requirements?
Tip 10: What’s the ROI?
An investment in a payment management solution should improve your organisations capability to collect funds and fulfil your mission. To assess the return on investment (ROI), you weigh the projected benefits and costs.
You may want to consider getting help with the ROI calculation from your system integration partner if you do not have internal IT and payments expertise. There are many ways to leverage payment data in your donor profile, for example, which can open up new opportunities for interacting with your donors and building loyalty.
To calculate costs, it’s best-practice to define “worst-case”, “as planned” and “best case” scenarios for donation growth over 3 or 5 years, and calculate the benefits and costs for each of these scenarios. Make sure to include both initial and ongoing costs for integrations and data migrations or imports.
Bonus Tip: Implement Customer Payment Management
Consumers and donors expect personalised experiences, your new payment solution should therefore ideally be a Customer Payment Management (CPM) system. A CPM system is aimed at combining the payment related information to CRM information, giving you the full 360 view you need to create true personalised journeys for your donors.
If you have any tips of your own or questions on the tips listed here, feel free to reach out to me.
Peter van der Meij
Senior Solution Specialist and Principal Trainer
Peter has years of experience in both nonprofits and Salesforce with over 100 projects related to payments under his belt.