Direct Debit Return

Mark Becker

We are new to online donations through RENXT. Our previous non-BB payment processor took care of direct debit returns for us. Now, when we receive notification from the bank that a direct debit has been declined, we have already (automatically and immediately) sent the donor a tax receipt acknowledgment email. Additionally, I have entered the gift into RE by approving the batch. By the time we learn of the return, our head of school has already sent thank yous, but our Finance office is left with covering the gift (as well as the return fee ($5.00)) from our operating funds.

What is the process for resolving this?
Do I request a reattempt from the donor?
If the donor enters another gift online, what do we do with the original in RE?
How does this reconcile with FE?

Gratefully,
Mark

Susan Leslie

Hi Mark,

We treat direct debit returns and credit card refunds the same way. Once we are notified of the return or processed the refund through Blackbaud, we then do an adjustment on the gift and turn it a zero gift. This keeps the history of the gift and at the end of the month, it allows matching with our accounting. We do ask our development team to contact the donor and see if they will make the gift in another fashion along with the service fee we were charged. We have been lucky enough not to have more than a couple of these.

Mark Becker

Hi Susan, thank you very much for your reply, as well as insight. Luckily, this is how I handled it - I appreciate your confirmation as we will continue processing these in this manner. Grateful for your assistance!

Lisa Theurer

Hi Mark and Susan,

We handle it a little differently. We have a fund id named (Return by Bank) where we put those. then when someone calls to ask, we know why and can share that it didn't go through as expected. The data is still there, but it's not a gift and wouldn't show up if the donor looked up their charitable giving online. Also, our treasury management team can reconcile the returns as well as the gifts.

the only bad thing about direct debits on the website. It seems like a small percentage don't enter their bank info accurately, and unlike CC, it takes time to find out.

Thanks for your thoughts on this.

Mark Becker

@Lisa Theurer Thank you, Lisa. That's a great work-around that I'll consider with our Finance team. By the way, how do your donors review their giving online? Is that a feature I am missing in NXT?

Much appreciation, and enjoy your day!

Michelle Ruth

@Mark Becker My Guess is they would notice when they receive their end of year giving statements. Or if the amount was for over $250, and they didn't get a receipt.

Michelle Ruth

@Lisa Theurer
So when you run end of year queries, do you just exclude this fund via the query?

Michelle Ruth

@Susan Leslie How do you do an adjustment of the gift in Raiser's Edge or RENXT after the gift has been posted to Financial Edge?

JoAnn Strommen

@Michelle Ruth To adjust a gift in db view, go to the gift record, select the drop down menu under ‘Gift’ and choose adjust. You enter new amount or any other changes. I always document reason and any notes for future reference.

For the Adj GL post date/status and the check box, visit with your finance office on how they want the adjustment data to come through. It could be today's date, original gift date or something different.

Faith Murray

@Mark Becker
We adjust the gift down to zero and add context in the Adjustment Notes to why it was adjusted. We do not ask the donor to cover the cost of the return, as we feel it is embarrassing enough for the donor to have to resubmit the original payment info, and we focus more on relationship building than on nickel-and-diming. What that means is that the return fee is covered as an overhead of Development operations. We suspend the original recurring gift (so it doesn't process in the interim) while we reach out to the donor to correct the bank information.

I'll mention here that we don't use BBMS for direct debits. They charge a fee, and we can get the service free through our own bank portal. (We still have return fees, but not processing fees.) Unless your Finance Office still cuts paper checks for employee wages, they probably already use a direct debit portal for depositing employee paychecks, and you might see if a trusted staff member in Development can piggy-back off of that to process direct debits free of transaction fees (or at least cheaper fees) for your organization.

David Geidel

@Mark Becker

Donors do not have access to edit their recurring gifts or see donation history. I was surprised RE didn't have this feature as every basic giving platform has this. We have donors email us to make changes.

RE came up with a “portal” but it is wacky and has a lot of problems. We didn't find it helpful. It seems more complex than a simple log in to manage gifts like every other platform has.