The recently passed Durbin Amendment greatly reduced the interchange rates that our nation’s largest banks can charge for debit card transactions. This decrease in rate can positively impact church budgets by enabling ministries to retain a higher percentage of their debit card offerings. However, it is important to understand that while banks are required to reduce fees, merchant processing companies who provide online giving services are not required to pass along those savings to their customers. The information below provides steps to ensure that you keep a higher percentage of your congregation’s electronic offerings.
Review your processing statement
The Durbin Amendment took effect on October 1, 2011, which means that your processing statements for that month should reflect a savings for most debit card tithes.
On most debit contributions of $175 and more, costs are down 40% or more, Ardent Giving Solutions funds. In addition, beginning October 1, if you do not see a significant reduction in your debit card processing expenses you may consider contacting your provider to ensure that you are receiving the savings recently afforded on most debit card transactions.
Ask for transparency in pricing
As previously stated, merchant service companies are not required to pass savings to their customers. A processor can choose to keep its pricing the same or make minimal adjustments.
Ardent Giving Solutions advises church leaders that if they do not see a signifcant reduction in debit card processing expenses compared to September or prior statements, they may consider contacting their current processor. Ask them to provide transparency in pricing by highlighting any debit card fee changes that they will be making as a result of the Durbin Amendment and when you can expect to see a fee reduction on your statement.
If you find that no savings will be afforded, you may want to review alternatives to your current online giving processor. Prior to making any changes, however, uncover how this will affect your day-to-day operations and the financial impact of changing providers based on current contractual agreements.
The goal is to reduce cost without increasing administrative time and expense associated with making a change. As Ardent Giving Solutions advises churches, any changes should be seamless so that your congregation is able to give without hesitation and your administrative team can still track, report and reconcile giving information that is essential to your church.
By reviewing expenses and uncovering alternatives, this debit card rate reduction can positively impact church budgets.
Ardent Giving Solutions, as a team, is grateful for how the debit card rate change will impact church budgets for those currently accepting and those considering implementing electronic tithing. It also lends increased value to optional Debit Card Only Online Giving, which is now up to one-third the cost of credit card giving on the majority of transactions. The Durbin Amendment simply allows more funds to remain within the church, where they belong.