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In the years that have passed since Apple released its first iPhone, smartphones have become as ubiquitous to Americans as car keys—few people go anywhere, much less do anything, without them.
The rise in dominance by this mobile device has transformed the ways people communicate, connect, and collaborate, whether for work, recreation, dating, entertainment, philanthropy, or even worship. This transformation has even reshaped the smartphone itself: Initially fashioned in the spirit of the landline telephone and the cellphone, it now has evolved to the point where phone calls themselves are increasingly rare. Text messaging and software-based apps are the primary uses.
Consequently, the number of first-time phone app downloads worldwide continues to explode. And phone apps devoted to financial-related activities are among the fastest-growing categories in the industry, with consumers accessing them more than 1 trillion times in 2019—double the pace from just two years prior, according to data and analytics firm App Annie. Research firm eMarketer, another analytics company, estimates the average American adult spent just shy of three hours per day in 2019 using their smartphones—and 90 percent of that time was spent using apps.
Church leaders must take note. These trends have implications for reaching people in their congregations and surrounding communities. They also have ramifications about the way people interact with their churches, especially in the realm of financial giving. Sensing this latter point, at least 14 vendors have emerged to serve the church and nonprofit world, particularly with giving apps designed to help facilitate regular contributions. That’s been both a blessing and a curse, say church leaders and consultants serving churches.
“Everyone and their uncle—and their uncle’s equity fund—are getting into that business because they’re trying to grab a slice of the not-for-profit donation pie,” says church IT consultant Nick Nicholaou, an advisor-at-large for ChurchLawAndTax.com. “There’s just no way I’ve figured out to try to keep up with them, much less evaluate them. It’s akin to a wildfire.”
Nevertheless, with smartphone and app trends expanding as they are, leaders need to somehow still keep up—and do so without letting it become an all-consuming distraction.
“The short story for me is that churches need to do their homework, do their research, make informed decisions, implement them, and then get back to the business of winning people to the kingdom,” says Jonathan Smith, director of technology at Faith Ministries in Lafayette, Indiana. “Too many times software is a revolving door of endless decision-making for very little gain.”
Toward that end, we asked Smith, Nicholaou, and Lisa Traina, a partner at CapinCrouse’s CapinTech, to help us develop a framework that church leaders can use to assess mobile giving options.
This framework doesn’t tell leaders what they should choose—although a companion article provides names and basic information about the 14 giving apps that churches might consider if they decide a giving app makes sense. Rather, it offers a framework of seven points regarding how to choose.
Point #1: The mobile trend isn’t going away
Some leaders immediately embrace new technologies, while others take the wait-and-see approach, and still others lag behind. For those who typically lag, it’s time to stop: mobile is mainstream and isn’t going away.
Aside from the stats above about smartphone use and apps, it is also worth noting that 60 percent of all time spent on a device in the United States is through a smartphone, while only 30 percent occurs on desktop and laptop computers, and 10 percent on tablets, according to eMarketer.
“There is a younger generation that organizations have to appeal to—and that generation wants mobile,” Traina says. “The younger generations want to be able to give and support to the causes they care about easily. The challenge is that there are lots of organizations that have similar messages, goals, and so on, and the organizations that can provide ease will benefit.”
Vanco Payment Services, which offers the GivePlus giving app serving churches, similarly noted generational considerations in its “The Churchgoer Giving Study,” a November 2019 report based on survey responses from 1,000 people.
Not surprisingly, younger age groups were more enthusiastic about electronic giving in general. Among ages 24 to 34, 50 percent said they want electronic giving options, and 7 percent said they use giving apps. Among ages 35 to 44, 14 percent said they use giving apps. And 30 percent of those ages 45 to 54 said they preferred using credit or debit cards for making donations.
Point #2: There are numerous types of mobile giving options
Don’t assume a mobile giving app is your church’s only option.
“The trend is toward apps, but mobile websites are often effective,” Smith notes. His church doesn’t have a giving app, but its website is responsive to mobile devices “as is our giving portal, so the issue is not so much having an app as having a web presence that displays properly on a variety of devices and platforms.”
The focused attention on a website—rather than both on a website and an app—may better utilize resources, too. Apps require more frequent programming and security updates, whereas a mobile-friendly website will not, he adds, and while apps must be designed to work both on the iOS (Apple) and Android platforms, websites do not face that problem. And online giving offers many of the same primary perks that giving apps do: setups for recurring payments; behind-the-scenes tracking and reporting to help with administrative tasks and reporting functions; and faster abilities to generate contribution statements.
However, market research shows smartphone users don’t use mobile browser apps nearly as much as their other apps. Business of Apps, a data analytics company, said only 12 percent of a smartphone owner’s average daily use in 2019 involved a mobile browsing app. This underscores the need for church leaders to research their attenders’ phone use habits and preferences. If few congregants say they regularly use their phone’s browsing app, then that may be a sign a dedicated giving app is a better way to go.
Apps offer unique benefits, too. Some, including Subsplash Inc.’s The Church App, are comprehensive in nature, allowing congregants to find and register for events, receive church news, and watch recorded sermons—and also make their regular financial contributions.
Apps also can send push notifications, and some even incorporate abilities to accept mobile wallet payments set up on users’ phones.
Those features may be helpful, but Smith cautions church leaders to make certain those features are necessary for success. They may not always be.
Lastly, don’t overlook two other electronic-based options: Automated Clearing House (ACH), also known as “eCheck” for electronic payments and automated money transfers; and, text-based giving services, which congregants may like, given how commonplace texting has become. These can be used by churches, often at a lower cost, without needing an online giving or mobile giving app solution.
Point #3: Get a high-level view on giving apps
Do some initial, high-level research about the giving app options available to churches. For starters, figure out which payment methods each app processes. Credit and debit cards are staples, while some also can handle ACH/eCheck. Less clear is how vendors might incorporate cryptocurrencies, such as bitcoin, so ask.
Also verify whether certain basic functions come standard. Recurring payment setups for individual givers is one. Reporting functions is another.
Additionally, if your church uses church management software (ChMS), the provider may either already offer a companion giving app or it may partner with a vendor whose giving app is compatible. Such synchronization isn’t a necessity—different software solutions can work together well. But a unified approach can be effective because it automatically connects contributions made through the app with the back-end databases, reporting tools, and administrative work tasks the ChMS organizes and generates.
A unified approach “may simplify operations the most,” Nicholaou says.
If your church doesn’t have the ability to use a unified approach, or it prefers to bring solutions from different vendors together, then Traina recommends investigating a few additional pieces of information. Find out what types of application controls are available for church staff members to use, she says, and determine how integration will work, as well as the automating of different processes, and the report-generating mechanisms your church will need for financial reports and budgets. “These are key features that should be available to make things efficient while also giving you the ability to research or investigate transactions” in the event concerns about possible embezzlement or fraud arise, she adds.
Another early step is to identify which giving app options are available in both Apple’s App Store and the Android-based Google Play. Statista, a web research firm, says 52 percent of the US-market is Android-based, while 47 percent uses iOS. Most giving apps are available through both stores, but not all. Your church will not want to select one that is only available in one, but not the other.
One more initial step: read through the ratings and reviews of the apps on the respective stores. While wading through these may feel cumbersome, and separating fact from fiction isn’t always easy, these still offer a general vibe from the marketplace about the vendor and the app. Smith notes that app reviews sometimes are given by individuals who use an app the least, making their feedback less valuable. Adds Traina: “Apple has always had a really stringent process for getting in the App Store. The process is less stringent for Android-type apps.”
Point #4: Security is crucial
As your church begins to identify the short list of options, your attention should turn to security.
“If you have a breach because of a weak application, and donors’ information is compromised or you lose funds, you’re not just losing that existing money. Your donors could lose faith in you, affecting future giving,” Traina says.
When evaluating a giving app, she recommends the following:
- Verify the app includes built-in encryption and other security measures;
- Determine what types of access controls to the app are in place;
- Confirm compliance with Payment Card Industry (PCI) security standards, especially if the church ends up storing, accessing, or transferring card data. (Adds Smith: Request both documentation showing how the vendor complies with PCI, plus documentation from an outside, independent security auditor affirming that compliance.); and
- Ask the vendor whether it also has access to the collected donor data, and what steps it takes to secure its access to that data.
Point #5: Costs and contract terms
One of the more controversial topics in the giving app industry is pricing, and it represents one of the most important factors your church will need to address. Each vendor uses differing approaches, making it complex—and sometimes difficult—to compare competitors. With your church’s short-list of vendor options in hand, request pricing in writing so that you and your team can spend time privately reviewing and discussing how each app’s potential costs will add up.
The costs to anticipate often include some combination of the following:
- One-time initial setup fee;
- A plan fee (usually charged monthly); and/or
- A percentage fee per transaction (usually ranging between 1.99 percent and 3.95 percent, with some also tacking on an extra 25 cents to 30 cents per transaction).
Some vendors also offer tiered pricing, either with the plan fees, transaction fees, or both, depending on the size of church or the volume of transactions the church processes.
“Run the numbers,” Smith says. “Ask [vendors] for a cost analysis, including all fees based on your current giving [activity].”
Be cautious, too, about vendors who say churches should encourage their donors to slightly increase their donation amounts to help cover transaction fees. Smith says he finds donors are reluctant to do this—and in his experience, when a donor finds out a high fee is associated with processing a contribution, the donor usually opts to use a lower-cost alternative, such as cash or check, even if it creates inconvenience.
Be sure to also ask about the type of contract involved, Traina notes. How long is the agreement for? What is considered a breach by either side? Does the church pay a penalty to terminate the deal before it ends? Is advanced notice required if the church doesn’t plan to renew? What types of warranties and customer service do the vendor include as a part of the arrangement, particularly when problems or glitches arise?
Point #6: Get references—and find out how well the vendor understands churches
Like any other major purchase, ask the vendor for references, preferably from other churches who use their app. Then make certain you contact those customers and ask, among other things, “what you don’t like and what the vendor can and should do better,” Smith says.
The majority of vendors are for-profit companies. Find out whether they share your church’s faith background, or at least can demonstrate a working knowledge of how things work within churches. “I believe you always want to work with someone who understands the church world and how we make our money,” Smith says. “Not everyone along the transaction fee chain is going to get that but I believe you want your primary service provider to understand who you are, what you do, and that there is a heart [behind] your mission that makes this all possible.”
Point #7: Mobile giving, including giving apps, is a tool—nothing more
Remember that your church likely offers a variety of ways to give. Cash and checks physically given at church, either through the passing of the offering plate or a box inside the sanctuary, remains the overwhelmingly single-biggest way people give. But a holistic approach involving multiple options likely will serve your church well. The 2019 National Study of Congregations’ Economic Practices, a survey of 1,231 congregations nationwide, found “a positive relationship between congregations that embrace innovative donation technologies and reported growth in both revenue and size.” Among those offering a smartphone app, the survey found, 60 percent said giving increased at their church.
Still, the survey emphasized that digital giving is but one tool among many. In other words, don’t get hung up on the idea that a mobile giving app should be your central focus. It should serve your church, not the other way around.
“Ignore promises [an app will] increase giving. Compare actual costs and evaluate them against your desired return on investment,” Smith says. “Giving solutions are tools that make it easier for folks to give money, but don’t desire to be hip and cool to the point where you don’t actually increase income versus passing the plate.”