Digital giving platform GoFundMe has opened up to charity fundraising in the UK and introduced the ability to claim Gift Aid on donations made via the platform, in a statement that directly attacked rival platform JustGiving over its fees structure.
GoFundMe has announced today that it has launched a new product “with 100 per cent of Gift Aid guaranteed to go to charities”. It also said that it won’t make charities “pay a subscription fee simply for using its services”.
This is also the first time that GoFundMe has made its platform available for fundraisers to raise money for charities. Previously it was effectively a crowdfunding platform for individuals without the ability to cliam Gift Aid.
The US platform revealed its intention to expand into the UK market in January 2017, with the appointment of John Coventry to head up communications in the UK office.
In January of this year that it was dropping its old 5 per cent platform fee, however a 1.9 per cent processing fee was retained. The platform also asks users to tip to cover its costs once they have made a donation.
GoFundMe said its new “fundraising service stands in stark contrast to JustGiving” and claimed its platform is now “four times” cheaper for fundraisers than its competitor.
JustGiving currently charges a 5 per cent fee on donations, which includes a 1.25 per card processing fee. It also takes a 5 per cent fee on gift aid in donations. Charities are also charged a monthly subscription fee of £15 or £39 depending on their size.
However JustGiving announced yesterday that it was introducing a new ‘Donation Boost’ tool to its fundraising pages. JustGiving said the new tool will allow donors to make a “boost of £1 for every £20” to cover the fees normally charged for processing a donation.
Generosity 'undermined by opaque and misleading' fees
GoFundMe used its announcement about the changes to its platform to attack on JustGiving specifically, with John Coventry, GoFundMe’s head of UK communications, quoted as being “shocked” that JustGiving took a “slice from gift aid”.
GoFundMe commissioned YouGov to conduct some polling on its behalf, and found that “72 per cent of people believe it is unreasonable for platforms to take a cut of gift aid claimed for charities on eligible donations”.
The press release said: “The generosity of people across Britain is being undermined by opaque and often misleading fee structures used by some online giving platforms, according to new research by YouGov on behalf of GoFundMe.
“One of the biggest concerns is the hidden fees platforms including JustGiving take from Gift Aid. Gift Aid is a government-funded scheme which adds 25p to every pound donated to registered charities by UK taxpayers.”
It claimed that 34 per cent of respondents to its YouGov survey “would be more likely to donate online if it was easier to see how much of the money actually goes to charity rather than the platform”, while 30 per cent said “they would be more likely” to use digital giving platforms if they knew what the fees were being used for.
John Coventry, head of UK communications GoFundMe, said: “We were shocked to discover that some platforms, such as JustGiving, take a slice from Gift Aid they claim on behalf of charities.
"It beggars belief that a company would take taxpayer cash from a government scheme designed to help people give to charity and the research we’re releasing today shows that we’re not the only ones shocked.
"Generous British donors can be absolutely sure that 100 per cent of the gift aid generated through campaigns they run on GoFundMe will go to charity, end of story.”
A JustGiving spokesman said: “As the world’s first online giving platform, JustGiving has always welcomed new sites joining us in the charitable space. In the 17 years that JustGiving has existed, we’ve always focused on providing the best possible products for our charity partners and our fundraisers.
“Having a vibrant, competitive sector pushes us on in our pursuit of our company’s mission; to grow the world of giving.”