The Ultimate Guide to National Change of Address (NCOA)
Now that you know how to start a nonprofit, the next step is to establish and maintain your relationships with members and donors. This is critical for organizational growth. Having accurate contact information allows you to reach those contacts to maintain your relationship and ideally have a base of recurring donors.
Yet, every year, tens of millions of Americans move to new addresses, and that number includes a percentage of your established donors or members. When your organization sends mailings, increasing numbers fail to reach their intended recipients, often being returned by the post office because of a change of address (COA).
Donors often become immersed in establishing their new life and do not reach out, even though they may intend to continue donating to your organization. Thankfully, one of the best nonprofit tips out there is to harness the power of the National Change of Address Validation process.
Here’s what we’ll cover today:
- What Is the National Change of Address Validation (NCOA)?
- Why Should Your Organization Use NCOA Validation?
- How to Use the National Change of Address for Your Nonprofit
- Fraud Risks Related to NCOA
- Final Thoughts
What Is the National Change of Address Validation (NCOA)?
Every year, the United States Postal Service receives more and more mail that is undeliverable because of changing addresses. As more consumers find new homes and these new movers fill out change of address forms, USPS keeps records of the addresses so they can update and forward mail to the new address.
However, in an attempt to reduce the amount of undeliverable mail they have to deal with on a daily basis, they have arranged a system where businesses or organizations can gain access to the NCOA database through a validation service to do an accuracy check of the NCOA address on their contact information lists.
This service automatically updates the database with any changes reported through COA forms, ensuring that an organization’s database is as accurate as possible.
Why Should Your Organization Use NCOA Validation?
As more than 40 million Americans move every year, your nonprofit faces the risk of losing contact with valuable donors and members through outdated address information.
Losing this contact could set your marketing efforts back and impact your project management attempts going forward.
Furthermore, when mail can’t be delivered, it comes back to you. We all know that staff, members and volunteers of nonprofits often have more work and less funding than they would like. If you are unable to locate the proper information to update your systems, you expend more time and money in the process. Utilizing precious resources for processing returned mail is not ideal!
Oliver is pondering if his organization should use NCOA Validation.
NCOA is software that you need a license to use. Once your license is established, NCOA validation allows you to perform regular database updates to keep the most accurate address list so that the risk of failure to deliver is significantly minimized. Using family names as well as individual name matches against the NCOA database along with the ZIP+4 code addresses, the system attempts to match addresses.
The system maintains address changes for up to 18 months, and when it locks in on a match, it will update your records for you, ensuring that your mail will reach its intended target.
Pro Tip: Since it is in the USPS’s best interest for companies to do this research on their own to cut down their own undeliverable issue, they offer discounts on mailing services which can save you additional money on your regular mailings as well as with undeliverables.
How to Use the National Change of Address for Your Nonprofit
There are a few important steps you need to take to get started. The most important of which is becoming a certified NCOAlink licensee. The steps immediately below will walk you through how to get registered.
Choose A License Category
There are six different licensing categories available, each with a separate pricing structure.1. Interface Developer
- Establishes an NCOALink interface for internal purposes and third parties.
Initial Fee: $7,350.00
Annual Costs: $1,500.00
Provides the right to distribute the NCOALink interface.
Annual Costs: $35,500.00
Allows the user to provide automation services to unrelated third parties, which must be at least 51% of their NCOALink processing, and process no more than 49% of files internally. Includes additional tools at no additional charge, such as DPV®, LACSLink®, SuiteLink®, and all upcoming "Link" products.
- Annual Costs: $245,000.00
Offers the ability to provide services to third parties and use the product internally.
Annual Costs: $20,600.00
Allows for processing internal house files that are not for a parent, subsidiary, affiliate or any related company or third party.
Annual Costs: $10,300.00
Permits the use of NCOALink data on multiline optical character readers to update and spray change-of-address information on mailpieces prior to submission to the USPS. In addition, can be used on delivery point barcode sorters to identify, sort, and remove undeliverable-as-addressed mail prior to submission to the USPS.
Upon determining which license is most appropriate for your organization and its plans, you can move forward with the registration process.
You will need to complete and submit the following documents to start the process. These forms are available through the USPS website, and there are additional resources available to help you complete these to the required standards.
A confidentiality statement
Self-certification statements that involve describing your nonprofit and its mission, your purpose for using NCOA, the approximate amount of records you will need to be validated with your update schedule, and which postal facilities you intend to use.
A record of your key officials and board members
PS Form 1357-W, which requests web access
Choose which program category you intend to use to perform the service and activate it with the authorization code you receive after receiving approval from your form applications.
Anthony is loving all these NCOA resources!
A testing process will begin to try out your software and tweak the procedure to ensure that data entry, DBF file access, and information flow smoothly before, during, and after NCOA processing.
Finally, once all parameters, documents, and procedures are verified and fine-tuned for licensees, the USPS will send you a licensing agreement and chart which shows any fees associated with the process, which you will need to sign and pay respectively to initiate the process.
Fraud Risks Related to NCOA
Not to rain on your parade, but it’s worth noting that there has been criticism about the NCOA program due to a potential risk of fraud.
Generally, mail fraud occurs when someone has access to your members’ or donors’ full name and address and submits a change of request form through the U.S. Postal Service (USPS) under their name, reporting a different address as their new address.
When your member or donor has mail or parcels delivered, the offending party opens it and can gain access to sensitive banking information, replacement credit cards, and other important documents which they can then use for identity fraud.
Any messaging to members or donors regarding your organization’s use of the NCOALink product should include a reminder that your organization receives an update only after receipt of the address change from the USPS. More specifically, make it clear that your organization did not request a change of address.
As a result of you using the change of address as an opportunity to reach out to members and donors, you may be able to help them identify any potential fraudulent situations! If they receive a notice from you that the USPS indicated they have moved, if they haven’t requested a COA, you may be the first to alert them. This early notification will help your members or donors to investigate and remedy the situation, hopefully before any fraudulent activities are committed.
While it may not be a priority in the same way creating your bylaws is, or setting up insurance for your nonprofit is, the NCOA system can prove invaluable for maintaining relationships within your community. This system isn’t perfect, nothing is! However, it can play a big role in improving your NPO marketing and keeping your database up-to-date while saving you considerable time and money throughout the process.
Being able to maintain contact with your donors, reduce expenses associated with failed mailings, and save money on your postage are all amazing benefits that can save you far more money in the long run than the expense to perform the database update.
💡What is the National Change of Address database?
The National Change of Address database is run by the United States Postal Service and it keeps record of current and updated addresses. Businesses and organizations have access to the database in order to help them validate addresses from their contact information lists. Find out more.
🔑 How much does NCOA cost?
It depends! Businesses and organizations have to become a licensee before they can utilize the database. Depending on what type of licensing category you fall into, the annual cost ranges from $1,500 to $245,000. Find out more.
📝 What are the drawbacks of NCOA?
NCOA can be a great asset to have, however, the program does have a risk of mail fraud or identity fraud occurring. To help mitigate this, you can let your members know that NCOA updates you on an address change after the member has received the change request. Find out more.
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