In 2011, an Oxfam India donor wrote an article on how the NGO spends around 70% of the donations it collects on the fundraising cost itself, leaving only 30% for the actual charity project. The donor, who went through Oxfam’s annual report to discover this statistic, was naturally upset that a large sum of his donation was going towards admin costs and not towards aiding people. In return, Oxfam India’s CEO responded saying that admin costs were inevitable for any organisation, and she argued that Oxfam’s fundraising costs were mostly around 50% (still a significantly large ratio).
Most Indian and International NGOs will relate to Oxfam’s plight. Fundraising costs are the devil every nonprofit has to negotiate with. Reaching out and convincing the donor is difficult and traditional fundraising methods like door-to-door marketing, charity events, call centres etc. of course, entails a lot of spending. And, most NGOs have to deal with these expenses. Luckily, for bigger organisations like Oxfam, even the leftover funds of 30%-50% turn out to be impactful considering the greater amount of donations they receive. Smaller organisations have bigger problems since the funds they receive are marginally lesser, a 50% slash to admin costs makes most of their projects unviable.
Do they have another option?
In 2011, Oxfam and others couldn’t have thought of a way around this cost. But, now they can. Multiple crowdfunding platforms have emerged in India, giving NGOs a chance to cut down their fundraising costs to as low as 9%!
Crowdfunding takes the whole process on fundraising online. NGOs who have to reach out or call each donor personally to make an appeal can now grasp the attention of thousands of donors in just a few clicks. Crowdfunding platforms in India enable organisations to promote their cause and receive funds directly on the platform rather than detouring through subsidiaries and agencies that often demand a high cut out of the funds collected.
Crowdfunding also helps bring in more donors. A lot of NGOs still rely on a loyal donor base, but crowdfunding allows you to enrol more donors towards your cause. Crowdfunding platforms that host a number of NGOs, have a loyal donor base of themselves, which gives any small or big NGO a chance to reach out to more donors.
How can NGOs make the most of Crowdfunding?
Though a lot easier, and in many cases, more effective than traditional fundraising methods, Indian NGOs still need a working understanding of the process. At, ImpactGuru.com, our main aim is to first educate and assist the NGOs through the crowdfunding process and second, to help them effectively run a fundraiser. We assign each NGO a Dedicated Relationship Manager who assists them 24x7, at all steps, right from creating a fundraiser to the disbursement of funds.
“While some bigger NGOs are tech-savvy, it is the smaller ones, the regional ones that need a lot of help, right from understanding what crowdfunding does to learn how to crowdfund for a cause. We make it a point to share our expertise in crowdfunding with all NGOs, no matter how big or small they are,” - Meet Furia, head of the NGO team at ImpactGuru.com
Less fees, more funds
Crowdfunding may bring down the fundraising costs, but at, ImpactGuru.com, we make sure we bring it down even further. We have the lowest platform fees amongst all the crowdfunding websites in India, which allows NGOs to keep a larger amount for the cause.
“We acknowledge that crowdfunding is still very new for NGOs in India and we have kept our fees low to encourage more NGOs to try out this method, without the fear of losing a lot in the process. We also initiate new offers and challenges to make crowdfunding exciting and rewarding for NGOs,” says Khushboo Jain, co-founder at ImpactGuru.com
In fact, last month itself ImpactGuru.com initiated the #ImpactMonthChallenge, a month-long offer that allows any NGO to raise funds with absolutely no costs on our platform. All fees at our end were absorbed with an anonymous donation which allowed NGOs to keep a 100% of the funds they raised.
Daan Utsav for NGOs
Every year, ImpactGuru.com celebrates a week of giving, where every Indian citizen is encouraged to do charity. Daan Utsav, an initiative by GiveIndia, is held in the first week of October where NGOs benefit out of the enthusiasm created around giving. And, in the recent years, NGOs have started responding to charity. The Indian Philanthropy Report 2015 states that Indian donors have increased by 100 million since 2009, increasing the desire for philanthropy amongst Indians. Last year, ImpactGuru.com’s Daan Utsav initiative saw participation by 20 big NGOs like Aasra Trust, QMed Foundation, Aaina etc.
International donations to scale the impact of crowdfunding
ImpactGuru.com’s strategic partnership with GlobalGiving, the largest global non-profit crowdfunding website, allows us to let NGOs give tax benefits to their UK/US donors. Our platform invites donations from a lot of NRIs/PIOs residing in different countries, who want to give back to their homeland. It also facilitates donations from people of other nationalities who wish to give to an Indian cause, thereby helping smaller Indian NGOs get visibility at an international level.
Webinars, training sessions and more
We constantly keep in touch with our NGO community, even when they aren’t raising funds with us, to communicate our expertise and learnings about crowdfunding and how to raise money more effectively. We hold free training workshops, webinars and even one-on-one sessions with NGOs to train them better on how to run an online fundraiser!
Start a fundraiser with us for free in just 5 mins and we’ll help you with the rest!