Online Fundraising

Income in the Third Sector is disproportionately distributed – this also applies to online fundraising sites. The majority of these sites are dominated by larger charities. Larger charities are also on those sites that target the smaller charities and the smaller charities simply do not have the resources to compete. The majority of these sites charge set up or monthly fees and often a fee per transaction as well. This has a disproportionate impact on smaller charities.

Charities income sources can differ according to their size. Many of the smallest (50% have under £50k income) are reliant on cash donations and cheques from local community based forms of fundraising.

Generally amongst the smallest charities there is a lack of knowledge and understanding about online fundraising, also for some a lack of IT equipment and skill in their organisation. Many are run solely by volunteers. The majority of the Small Charities Coalition’s members say they have no experience or rate themselves as beginners in online fundraising. Of the 85% of them who ask for help with fundraising an increasing number are asking for help with online fundraising.

Advice to small charities:

• Do your research and find out about fees. Some provide additional support with the development of the charity’s page which might make the fee more reasonable.
• Do your sums – calculate whether a lower transaction cost will offset a higher set up fee or vice versa. Be realistic about how much you are likely to raise from this channel and assess whether it enough to outweigh the costs – don’t forget you also need to factor in the time to set up and maintain your web presence.
• Register for Gift Aid – until April 2011 you will get 28p extra for each £1 given if you do and the donor has completed a deliration. It is crucially important that you encourage all your donors to use Gift Aid, if they are eligible.

 Advice to donors:

•  Also do your research and sums – which site will pass on the best deal to your chosen charity
• Use Gift Aid and other forms of tax effective giving – payroll giving, CAF account