New Mastercard regulations offer opportunities to connect with recurring donors

How do Mastercard’s subscription rules affect nonprofits?

• The new regulations only apply to donors who use Mastercard for their recurring gifts. 
• Nonprofits must send a confirmation email to all new monthly or recurring donors when they sign up that includes the terms of the subscription and clear instructions on how to cancel. 
• For every successful billing attempt, recurring donors should receive an email receipt and instructions for how to cancel the subscription. 
• Nonprofits must provide a user-friendly online cancellation method, similar to unsubscribing from emails, or an easily accessible link on their webpage with clear instructions on how to cancel.
• For recurring payment plans that bill less frequently than once every six months, nonprofits must send a notification with the terms of the subscription and instructions on how to cancel the subscription at least seven days prior to the billing date.
• Nonprofits are not exempt from Mastercard’s new compliance requirements, but they do have a six-month extension to implement new processes. Make sure you’re ready by March 21, 2023!

Free guide: How to Create a Monthly Giving Form that Converts

How DonorPerfect users can stay compliant with Mastercard requirements

1) Send an automatic receipt with information on how to cancel at any time

When a donor enrolls in monthly giving or when a monthly gift is processed, you will need to send a receipt of the transaction to the donor that includes the terms and conditions and how to cancel the recurring payment. 

In Online Forms:

• Our new Online Forms automatically include the terms of the recurring donation and a link to the online cancelation method or the webpage with details on how to cancel.
• If you choose to customize your email by using a DonorPerfect template, remember to include the terms (monthly until canceled) and how to cancel (online method or webpage with details) in the email receipt. 

In Classic Forms:

• Enable Email Receipts in Classic Forms to send an immediate receipt. Include information on how to cancel in the email. 
• Include information on the form for who to contact with questions about a recurring gift. We recommend placing this in the footer of your Classic Forms (our new Online Forms automatically do this for you).
• Require the email field on your donation form so that you can send donors email receipts in the future. Sign up here to try our new DP Forms that automatically require email.

In your DonorPerfect system: 

• Turn on automatic receipts for monthly giving in DonorPerfect. Simply include details on how the donor can cancel (either through the online cancelation method or the webpage with details).

2) Find proof of automatic receipt after each payment

Mastercard requires proof that a good faith effort has been made to send an electronic receipt to donors after each recurring donation. If you send email receipts through DonorPerfect, you can check the status of your emails and show proof of email receipt under: Receipts > Email Receipt History.

3) Send notification prior to charge for bi-annual or annual recurring donations

For donors whose recurring giving occurs less frequently than every six months (180 days), nonprofits must send an email at least seven days prior to the billing date. This email needs to include the terms of their subscription with instructions on how to cancel. Depending on your preferences, here are two options for compliance: 

• This new regulation does not apply to donations with a monthly frequency. Our recommendation is that you only have “monthly” as a recurring payment option on your donation forms. Our Online Forms only allow monthly recurring donations, since our data indicates 93% of donors who choose recurring gifts prefer to give monthly. 
• If you use Classic Forms and provide options for semi-annual or annual recurring gifts, you can create a SmartAction that creates a contact transaction that is assigned to a particular staff member at your organization to send a notification. Seven days before contact is due, it will appear on their dashboard as an assigned task, and they will have to contact that donor. 

4) Show the donor a summary of what they are about to authorize before they submit their electronic recurring donation. 

All DonorPerfect forms, both Online and Classic, currently adhere to this requirement. 

5) Provide clear terms and conditions at the point of payment, including the price and the frequency of what the donor will be billed. 

All DonorPerfect forms, both Online and Classic, currently adhere to this requirement. If you’re using our Classic Forms, we recommend putting your terms and conditions in the email confirmation. 

The good news: more engagement opportunities

While they may be a challenge to implement initially, Mastercard’s new regulations also offer opportunities to stay in touch with your recurring donors. They can also help you build trust with your donors, since they’ll have better insight on how you process and handle their gifts. 

Here are some ideas for automating and sprucing up emails to your monthly donors:

• Schedule an automatic monthly email to all of your recurring donors with an email service like Constant Contact, use automatic receipts for monthly giving, or set up reminders in your calendar on the first of the month to stay compliant. 
• Include thank-you language in your receipts, and use a powerful photo or graphic to show your monthly donors how they’re making a difference.
• Include event registration reminders or program updates when relevant to keep your recurring donors connected to your mission .
• Create a stylish email template using Canva or other free tools to catch your monthly donors’ eyes and attention. 
• For donors who are thinking of canceling their monthly gift, give them the option to lower the amount in case they want to keep giving but their circumstances have changed.
• Include a link to volunteer or other ways to stay connected. Your monthly donors are loyal and committed to your mission, and volunteer opportunities or in-person involvement can help them feel like a valued member of your community. 

Create beautiful, budget-friendly emails and more with Design Tips for Nonprofits

DonorPerfect’s support team is here to help you meet Mastercard’s new compliance standards. Your donors will appreciate the added transparency, and added engagement opportunities may encourage them to increase their giving or involvement.