A “storm” hit the charity community in New Zealand a few years ago. It did some serious damage.

But it could have been much worse, if not for the work of some wide-awake organisations and people.

The storm: the end of paper cheques (checks in American English) as a payment method.

If that sounds like a problem to you, you’re right. Writing cheques is the main method for donating among older people – the main demographic of donors in New Zealand and virtually every other country. Losing that trusted payment tool may not mean much to you and me, but to many, it could make giving to your favourite charity very difficult.

If it hasn’t already happened in your country yet, it will happen eventually. Maybe soon. In Australia, banks plan to phase out cheques “no later than” 2030. Some Australian banks have already phased them out.

You too will have to face the storm.

Fortunately, we have some great data and experience from New Zealand to guide us.

New Zealand banks started phasing out cheques in 2019. By July of 2021, cheques were no more. That is fast. And it was difficult.

But New Zealand fundraisers learned a lot from that difficult transition.

Here’s the main lesson for every fundraiser in places still using cheques: Now is the time to prepare, even if the end of cheques is nowhere in sight in your country.

The use of cheques is declining everywhere, so you might not be worried about it. The challenge for nonprofits is that those still using cheques at the highest rate are older people.

Our donors.

Here are the unsurprising facts New Zealand fundraisers discovered about cheque donors:

• They were older (65+).
• They had higher than average retention rates.
• They were the most likely to make Gifts in Wills.
• They dominated direct mail programs.
• They were most likely to have fewer contact details — few shared their phone numbers or emails. This made the post the only way to reach them.

Many of these older donors were also resistant to change – they were reluctant to use new or different methods of payment.

These facts are similar around the world. It all adds up to a big problem for fundraisers when cheques go away.

Here are the steps many New Zealand fundraisers took. You should start doing these things now, even if it looks as if cheques aren’t going away in your country any time soon …

1. Assess your risk

What percentage of your donors are using cheques now? In New Zealand, it was under 25% for many charities, but for some organizations, it was as high as 50 to 75. Those with high levels of cheque-payers were at severe risk of lost income. But even those at the low end were looking at a real challenge. Nobody could afford to ignore this change!

If you think the end of cheques won’t be a big deal, please think again. It’s likely a bigger issue than you think.

2. Increase contactability

Direct mail donors are often not contactable by methods other than the mail. Put some time and money into getting these donors’ telephone numbers and/or email addresses. Start asking for these in donor communication NOW. The longer you do this for, the more details you will gather.

You should also look into data appends to get the information from third parties. This will really make a difference as the deadline draws close.

3. Promote other safe and secure ways of giving

• Deprioritise cheques as a payment method. Many NZ organizations realized they were strongly promoting cheques in their standard communications.
• Promote giving by credit card, bank deposit, and any other methods as safe, secure, and easy. NZ research found that the main reason donors didn’t want to switch was that they didn’t see other methods as secure.
• Make sure you are fully staffed with skilled and friendly donor care people. They are going to have a lot of conversations with nervous donors, especially as the deadline gets close.
• Adapt all your supporter communications to make sure information about the change is accessible to donors everywhere.
• Keep up with what the banks are doing and what other support is out there for people struggling with the change. (You won’t be alone in this challenge. Many commercial marketers will also need to get through this transition.)
• Have easily available FAQs about the change – not only for donors but for organization insiders, including your board.
• DON’T treat the change as a purely “admin” task. For many donors, it will be a traumatic change, and you can lovingly help them transition – not just so they can donate, but so they can get on with their lives.

4. Improve your digital giving experience

Take a hard look at your digital giving experience and journey. This is a real weakness for many nonprofits! So far, you may be “getting away” with this if online giving is a small part of your revenue or if your online donors are younger and more able to work around awkward experiences. A difficult giving experience online is a much bigger problem for those not experienced with doing things online!

Get a professional to audit your online giving. And be prepared for some harsh news.

Seamless, easy, intuitive giving online is something we all should have by now. It will pay off immediately in more completed online donations. But when cheques go away, it will be a must for survival!

5. Diversify donor acquisition

Direct mail is already becoming more difficult. No matter how successful you are at navigating the change, it will become more difficult and expensive after the end of cheques. Now is the time to seek other ways of finding new donors. Test as much as you can.

6. Donor care

The organizations that have done best in New Zealand’s transition are those with the excellent donor care. That means being available (24 hours, if possible) and spending time with donors. Many donors need to have their hands held while you walk them through the process. This will really pay off in keeping those donors through the transition.

Remember, you won’t be the only charity trying to do the right thing. But those that do it best will keep the most donors.

Keep in mind that every other charity a donor gives to (and every business that bills them) will likely be communicating about the change. You will be just one voice of many: The best way to stand out and be most helpful is to inspire donors rather than just instruct them. Make them feel as good as possible about changing their way of giving.

Remember that charitable giving is a joyful and inspiring activity for donors. Keep that at the top of your mind. Don’t share your own anxiety about the change with them. Just help them successfully navigate it.

Fundraising in New Zealand post-cheques

Now that we’re well into the post-check era, here’s what New Zealand fundraisers are seeing:

• Lower income than before the change.
• Lower donor retention.
• Some reactivation of “lost” donors. Remember that no matter how reluctant they are to change, they have to do so – and not just for you. They need to get on with their lives, and most will eventually figure it out.
• Direct mail acquisition is more difficult than ever.
• There is more giving via bank deposit.

You can see that New Zealand nonprofits did not emerge from this transition unscathed. But those with a wide-awake approach made things better than they might have been.

And that’s what I hope you will take from this: Cheques are going away everywhere. Maybe soon, maybe years from now, but it is going to happen. And now is the time to start doing what NZ fundraisers did! The sooner you get ready for this change, the better it will go – for you and for your donors.

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