Debit Orders vs Credit Cards

by Paysoft Impact | Apr 20, 2025 | Resources

Debit Orders vs
Credit Cards

WHY SUSTAINABILITY FAVOURS THE FORMER.

Payment methods

In the realm of nonprofit fundraising, the method of donation plays a pivotal role in ensuring long-term sustainability. While both debit orders and recurring credit card donations facilitate regular giving, their longevity and reliability differ significantly.

The Ephemeral Nature of credit card donations

Credit cards, by design, have a finite lifespan. Typically, they expire every three to four years, necessitating donors to update their payment information to continue their support . This expiration cycle introduces a natural attrition point, where donors might unintentionally lapse in their giving due to outdated card details.
CAF

Moreover, the risk of credit card fraud cannot be overlooked. In South Africa, gross fraud losses on credit cards amounted to R426.5 million in 2023, marking a 13.9% increase from the previous year . Such incidents often lead to card replacements, further disrupting recurring donations.

Additionally, nonprofits with recurring giving programs often lose 15% to 30% of their monthly donations due to expired or declined credit cards or address changes . These challenges underscore the vulnerability of relying solely on credit card donations for sustained support.

The Enduring Strength of debit orders

Contrastingly, debit orders offer a more stable and enduring solution. Once established, they continue indefinitely, unaffected by card expirations or replacements. This consistency ensures that nonprofits can rely on a steady stream of income, vital for planning and executing long-term projects.

At Paysoft Impact, we’ve observed that debit order donors exhibit remarkable commitment. Nearly 90% of our donors opt for indefinite contributions, with an average donation size of R235. Over time, this translates to a lifetime value exceeding R75,000 per donor. Such figures underscore the unmatched potential of debit orders in fostering sustainable giving.

In closing

While both methods have their merits, the evidence leans heavily in favor of debit orders for nonprofits aiming for long-term financial stability. Their resilience against common pitfalls associated with credit cards makes them an invaluable tool in the quest for sustainable fundraising.

The Case for eMandates

by Paysoft Impact | Apr 20, 2025 | Resources

The Case for eMandates

WHY GOING DIGITAL STRENGTHENS YOUR DEBIT ORDER CAMPAIGN

What are mandates?

A mandate is a donor’s instruction authorising an organisation to debit their bank account on an ongoing basis. In South Africa, debit order mandates must be clear, legally compliant, and easily retrievable if disputed. There are three common types:

Hard Copy Mandates: Signed physical forms. While legally acceptable, these are difficult to collect, store, and retrieve—and nearly impossible to automate at scale.

Voice Mandates: Obtained over a recorded call. Useful for telephone fundraising, but they require high levels of compliance and secure audio storage.

Electronic Mandates (eMandates): Completed digitally through a web form or mobile interface. These are the gold standard in modern donor acquisition.

Why eMandates outperform traditional methods?

eMandates offer a number of advantages that make them superior to their hard copy and voice counterparts:

Faster Sign-Up: Donors can complete a debit order form in under two minutes from any device.

Automated Record-Keeping: Each form is securely stored, date-stamped, and easily retrievable—no paper filing cabinets or audio archives required.

Scalability: eMandates allow you to acquire thousands of donors without increasing administrative burden.

SARS & POPIA Compliance: Leading platforms like Paysoft Impact ensure eMandates are aligned with all local regulations, including 18A tax preferences.

Reduced Error Rates: With real-time validations and account verification, rejected debit orders are significantly reduced.

The bottom line.

A debit order is only as strong as the mandate that supports it. In today’s fast-paced nonprofit environment, eMandates are the most secure, scalable, and donor-friendly solution available. They are not just a convenience—they’re a necessity for sustainable fundraising.