Economic uncertainty may lead to lower giving, warns NPC

03 Jun 2021 News

Some charities will lose individual donations because of the economic impact of the pandemic, the think tank NPC has warned.

Clare Wilkins, who leads work on effective philanthropy at NPC, said that some givers will decide that they “just can’t continue” with their direct debits if their personal finances worsen.

Wilkins was interviewed for the new issue of Charity Finance magazine, which is published by Civil Society Media.

‘Tightening their belts’

Wilkins said: “The problem we have at the moment is that a lot of people are reviewing their financial priorities. 

“If people are going through a difficult time financially, rethinking what is most important to them, perhaps tightening their belts, [then] in some cases they might feel like the just can’t continue with their monthly direct debit to charities.”

She said that data on individual giving won’t show up in public accounts yet, but added: “I suspect it [a fall in small donations] has happened, and will continue to happen because the economy is not going to spring back like an elastic band. 

“Individual giving is probably the same.”

Unrestricted income 

Wilkins described direct debit donors as “the absolute powerhouse of income generation” for some organisations, where they contribute hundreds of thousands of pounds which can be spent without restriction.

She said: “Their role is really important within the sector.

“A really big charity, like NSPCC or Cancer Research UK, will have a huge individual giving arm.”

As a result, charities take the risk of losing those donors “really seriously”, Wilkins added.

Collective

Helen Fleming, the head of high-value partnerships at Sense, says that charities will need to work closely with all their supporters to build “a collective sense of what you can do together”.

Fleming said: “People will have their own reasons for giving, at every level. 

“All good fundraisers recognise that and work with that.”

The full feature is published in June's Charity Finance magazine.

Charity Finance is packed with practical articles and analysis of the latest financial trends, as well as in-depth briefings on technical and legal changes, and benchmarking surveys to help busy finance teams get value for money. Find more information here and subscribe today!

 

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