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How Nonprofits Comply With Mastercard

Mastercard is implementing new rules and regulations for all organizations, including nonprofits, that accept and process transactions via Mastercard. As of October 2022, these rules and regulations were marked as optional for most nonprofits. However, implementing these recommendations is highly recommended because they still provide great benefits for your nonprofit and your donors.  

Read on to learn more about what exactly these new rules and regulations mean for your nonprofit. Or, check out our episode of The Responsive Weekly where Kelly Cristaldi and Chris Meschner from Virtuous discuss these updates. 

Watch the Full Recording Here

Definition of a Dispute

In order to understand why these changes are being made, it’s necessary to understand what “disputes” are in this context. Disputes are when customers challenge a charge that appears on their statement because they believe that charge is an error. 

Disputes can be incredibly stressful (if you’ve been there, you get it!). Many people’s first instinct in these moments is to worry that their credit card information was stolen. While that is always a possibility, it is also common that disputes occur because the individual does not recognize the information associated with the charge or simply forgot about the charge. 

Even though these new rules may require your nonprofit to change some processes, ultimately implementing these changes will reduce the risk of your donors disputing their donation charges. Reducing those disputes is both good for you and for your donors! 

Communication and Responsive Fundraising 

Before diving into the new rules themselves, it is helpful to put all of this in context of Responsive Fundraising. Giving is a deeply personal act that your supporters make, and it is important to make sure that you are connecting with your supporters in a way that honors this personal act. 

Connecting with your supporters at scale is always a challenge, but these new rules are an opportunity to turn the online giving experience and donation receipts into an opportunity to connect. As you read through below, be thinking about creative ways that you can implement these policies to create an authentic moment of connection with your supporters. 

Mastercard’s Updated Rules for Nonprofits

Let’s dig in to get clarity on these new rules and regulations from Mastercard, but keep in mind that chances are good that you are already doing 90-95% of these rules. 

Mastercard Rule #1: 

The Merchant [your nonprofit] must disclose the subscription terms simultaneously with a request for Card credentials. The disclosure must include the price that will be billed and the frequency of the billing (for example, “You will be billed USD 9.95 per month until you cancel the subscription”).

This means that Mastercard is requiring the giving page on your website needs to clearly communicate the donation amount, where the donation will go, and what the schedule is if they are setting up a recurring donation. The great news is that you are most likely already doing this with your online giving forms

Mastercard Rule #2: 

Immediately after the Cardholder completes the subscription order, the Merchant [your nonprofit] must promptly send a subscription order confirmation to the Cardholder through an email message or other electronic communication method that includes the subscription terms and clear instructions on how to cancel the subscription.

This rule from Mastercard is most likely already the standard practice for your nonprofit, but just double check that you have some mechanism that will automatically send receipts to your donors immediately after their donation is processed. 

Mastercard Rule #3: 

Each time that the Merchant [your nonprofit] receives an approved authorization request, the Merchant must provide the Cardholder with a Transaction receipt through an email message or other electronic communication method that includes instructions for canceling the subscription (and thereby withdrawing permission for any subsequent recurring payment Transactions).

This just means that every time a donor’s card is charged on a recurring basis, Mastercard requires that your nonprofit send an email notification to the donor that informs them about the charge. The email notification should also include information about their recurring schedule. The second part of this rule will be addressed more in Rule #4. 

Mastercard Rule #4: 

The Merchant [your nonprofit] must provide an online or electronic cancellation method (similar to unsubscribing from email messages or any other electronic method) or clear instructions on how to cancel that are easily accessible online (such as a “Manage Subscription” or “Cancel Subscription” link on the merchant’s home page).

Essentially, Mastercard is saying that your nonprofit must ensure that your donors have access to information about their recurring donation schedules and clear steps for how to cancel it. One of the simplest ways to accomplish this is to include that information on the automatic email receipt we discussed with Rule #2 and Rule #3. 

Information about how to cancel the recurring donation can be as simple as including a phone number that they can call to cancel the recurring donation or a reminder about how to access the donor portal (if you have one). 

Mastercard Rule #5: 

For any subscription where the billing occurs less frequently than every six months (180 days), the Merchant [your nonprofit] must send an electronic reminder to the Cardholder at least seven days but no more than 30 days prior to the next billing date that includes the subscription terms and clear instructions on how to cancel the subscription. The communication must clearly reference in the subject line that it relates to upcoming charges to the Cardholder (for example, “Important Information About Upcoming Charges to Your Account”) and the message must be distinct from marketing communications that are otherwise sent to the Cardholder.

This fifth rule from Mastercard is most likely to require a change in your nonprofit’s current process.  What this means is that if a donor has a recurring donation where the frequency of the donations is six months or greater, your nonprofit needs to alert the donor ahead of time that you are about to charge their card. This notification needs to happen anywhere from 7-30 days before that charge is made. 

Implementing These Rules at Your Nonprofit

First, make sure that your nonprofit’s fundraising software is set up to adhere to these rules. If you are a Virtuous or RaiseDonors customer, you can learn more about how we have implemented changes to comply through the linked Help Articles 

Something else to consider doing is reaching out to your supporters to inform them about these changes that are coming. You can use this opportunity to be more responsive and connect with your supporters to communicate both these changes and how much you value their generosity. 


For more information about these changes, check out the recording of The Responsive Weekly where we discussed this topic; however, please always refer to the Mastercard documentation as the primary source of truth. 

To learn more about how Virtuous is committed to providing the best responsive nonprofit CRM to organizations, click the link below. 

What you should do now

Below are three ways we can help you begin your journey to building more personalized fundraising with responsive technology.

See the Virtuous platform in action.  Schedule a call with our team for personalized answers and expert advice on transforming your nonprofit with donor management software.

Download our free Responsive Maturity Model and learn the 5 steps to more personalized donor experiences.

If you know another nonprofit pro who’d enjoy reading this page, share it with them via Email, Linkedin, Twitter, or Facebook.

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