One of the latest trends in accepting donations is this idea that you can "text to donate." In some cases this is a good idea. However, for churches that utilize online giving, the value for donations by text is questionable at best.
For starters, donations that come in via text messages can take anywhere from 30 to 120 days to settle. The donor texts their donation, then the mobile phone service provider adds the dollar amount to the donor's bill. Within the next 30 days, the mobile phone bill gets mailed to the donor. Around 15 - 30 days later, the donor pays their mobile phone bill. Eventually (after bill payment) the phone company sends the donation (minus some hefty fees) to the organization who solicited the donation. That is a long time for a donation to get to the intended recipient.
Other problems with texting to donate are with the donation caps. Mobile phone companies typically cap the donation at $10. This helps avoid abuse and fraud. Compare that to the average online donation of roughly $200, and you would be paying a lot of service fees and waiting a long time for those $10 donations.
Those people who have donated by text before are the few who know the problems that come afterwards - text spam. Once someone has donated by text, the service carriers have that information and often sell it to 3rd parties. This starts an endless cycle of the text spam that the donor receives, all because they wanted to donate $10 by text to an organization they care about.
Consider this - Our system tells us that one in ten online donations is $500 or more and over 2% of donations are $1000 or more. How much should a church go through to accept $10 donations through a new medium, from the same audience who is already aware of onsite & online donations? We think it is important to ask that question.
Aside from the challenges presented thus far, the primary issue with donations by text concerns the amount of money the non profit actually gets to keep after all the fees. There are few backbone service providers that provide the glue to move money over these text donations. They have monthly fees anywhere from $50 to $200, additional transaction fees, and set up/registration fees. On top of those fees are the fees the mobile phone service providers charge. There is no flat rate across the board as all mobile service providers impose their own fee structure. AT&T, Verizon, Sprint, and other mobile carriers all have their own schedule of fees. Normally you can expect that to be around 10%. An article recently published by Café Online stated that organizations are now retaining "up to 90%" of text donations, and that is suppose to be good news. Losing 10% off the top of each donation is not good news, that's awful news. Put those fees on top of the monthly fees and transaction fees imposed by the application providers and now you are looking at something hopefully in the 80 percentile range (of money received).
All in all, because it's new and buzz worthy, text to donate is going to turn heads. And as with all technology decisions, it is important to distinguish the "could we" from the "should we" decisions. We believe texting to donate for churches just does not add up.