Apple Pay wins favor with nonprofits that need recurring payments

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The tale of Apple Pay's first few years has been lackluster, though there are some signs the tech giant's mobile wallet is taking off.

There was the spike in usage this past fall, and Blackbaud, a software company that serves nonprofits, has signed a number of organizations to start using Apple Pay. The Charleston, S.C., company launched Apple Pay support in November, and serves more than two dozen non-profits.

"About four or five ask us about [Apple Pay] every day," said Kevin McDearis, chief product officer at Blackbaud. "And people are coming on in a steady clip."

Blackbaud's Apple Pay adopters include the American Red Cross, the American Heart Association, St. Jude's Children's Research Hospital, the Nature Conservancy, The Water Project, Save the Children and others. The company's most recent clients to add Apple Pay include the American Cancer Society, CARE,, PBS and the United Way, which plan to go live shortly.

The Apple Pay addition serves a couple of needs for nonprofits, said McDearis. First, there's an overall trend toward using mobile apps for charities and other nonprofits that McDearis said mirrors the overall trend of mobile adoption. "Using an app provides convenience, and the nonprofits trust Apple as a brand to move money around," he said.

Secondly, Apple Pay helps address the gap between courting donors and getting sustainable donations, McDearis said. It's easier to win a donor than it is to collect a large sum or retrieve recurring payments; Blackbaud has been adding mobile collection capabilities for the past four years, and Apple Pay can set up regular payments in the field.

"It's a big advantage to say to a donor 'don't give me one check, but sign up for ten or more monthly payments and to do that through the Apple app. People make that payment every month automatically without us having to check with them every month," he said. "It's a sticky form of engagement."

Blackbaud ties its payment gateway to its CRM system, which allows the nonprofits to engage donors in a targeted way or use analytics to personalize messaging, McDearis said. Blackbaud also offers PayPal as a digital payments option, and plans to add Visa Checkout and Mastercard's Masterpass this year. It's still considering Android Pay and Samsung Pay.

"It's a great idea," said Andy Schmidt, principal executive advisor at CEB. "It's simplicity. It makes it easy to receive a payment … the conversion rate for donations is harder than it should be. Someone promises to make a payment and then forgets to do so. And recurring payments are valuable for nonprofits since it helps them manage cash flow."

Blackbaud did not disclose its payments volume, saying it was too early in the deployment. There is a sizable and growing market of Apple Pay users who could add nonprofits to the mobile wallet via Blackbaud.

Apple Pay has suffered underwhelming adoption over its first three years, though it appears to have turned a corner. Apple CEO Tim Cook recently told investors the app is adding one million new users per week.

Other mobile payment companies have also made nonprofit donations a use case. Sionic Mobile has an app that encourages charitable giving through its merchant rewards system and Square reports it has collected more than 10 million donations via its donate function.

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