3 Steps to Removing Barriers to Charitable Giving
It’s been an unprecedented last couple of years for philanthropy to say the least.
Despite the list of challenges we’ve faced, from a global pandemic and market fluctuations to social justice movements and more, we’ve also seen the best in humanity when it comes to charitable giving.
Giving USA’s Annual Report on Philanthropy revealed another banner year for giving in 2021, with nearly $486 billion dollars donated, the majority of which came from individual donors.
Despite such success, we also realize that major challenges still persist, threatening the momentum of the last few years. Participation continues to be a concern, as overall giving rates have declined in the last few years even though average gift sizes remain strong. Economic uncertainty may also contribute to donors pulling back on their charitable giving in the near future as well.
To stem the impact of these scenarios on philanthropic organizations, fundraising leaders
need to prioritize ways they can continue to engage donors and make the process of giving as simple and easy as possible.
How can they accomplish this feat?
Focus on Flexibility
Fundraisers leaned in on flexibility in the wake of COVID-19, with online and hybrid events continuing to represent a changing of the guard in terms of donor engagement. While this trend is predicted to remain in the coming years, it speaks to the need for fundraisers to continue to assess how best to engage donors in today’s world and understand the ways donors want to give. Opportunities to implement financial technology platforms within the nonprofit sector represent revolutionary new ways to engage donors with flexible-giving options.
Online giving represented 12% of total giving in 2021, which represented an increase compared to pre-pandemic levels. More and more, donors are expressing interest in new ways to give, from DAFs and planned giving tools to cryptocurrency and give now, play later solutions. The more organizations can leverage innovation, the more likely they’ll be able to meet donors where they are and remove barriers to giving.
Such innovation can go a long way toward inspiring individuals to give at new rates. Considering the fact that individual giving as a percentage of disposable personal income has hovered around 2% since the early 80s, it begs the question: what role can new innovation in the sector play in terms of inspiring positive change for individual donors? Now is the time to explore and find out.
Push come to shove, what drives giving is trust. Pure and simple.
Technology can play a pivotal role in helping organizations to build trust with donors and developing a deeper, more meaningful level of confidence that drives results. It can help to democratize fundraising, empowering the average donor to give in new ways in particular.
To be successful in this movement, nonprofits will need to partner with like-minded organizations that will help them understand how best to build that trust in the online environment. Ones dedicated to developing technology for social good while sharing nonprofits’ trust-based model for philanthropy. This shared approach will have a trickle-down effect on donors and their willingness to contribute in the future.