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Is there a crisis in fundraising from individuals?

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Is there a crisis in fundraising from individuals?

Julian Lomas

Recent reports on trends in charitable giving by individuals paint a mixed, and at times worrying, picture that charities large and small need to understand and respond to:

  • The NCVO’s UK Civil Society Almanac 2019 shows that, while the public continue to be the biggest source of income for charities, there has been a recent drop in overall income from the public (from £23.2bn in 2015/16 to £22.9bn in 2016/17).

  • The Charities Aid Foundation (CAF) UK Giving report highlights that the proportion of individuals giving though direct donations or sponsorship has fallen from 69% in 2016 to 65% in 2018. Looking more closely at this report suggests that giving through sponsorship is particularly threatened; the proportion giving in this way has fallen from 37% to 32% in 2 years while the fall in direct donations was from 61% to 57% over the same period.

  • The Sunday Times Giving List shows that, while the total charitable giving by the UK’s ultra-rich is at an all time high (£3.75bn in 2018), the number of very rich individuals giving at least 1% of their wealth to charity has fallen from 105 in 2015 to 72 in 2018.

  • A report by Legacy Foresight highlights a 1.8% increase in income from legacies but that the rate of growth has slowed (reflecting economic conditions, particularly house prices).

  • A poll carried out by the Remember a Charity Consortium suggests the public is increasingly positive about legacy giving (and less so about giving to charity while alive); 47% believe it is better to give while alive than through a legacy (down from 63% a decade ago) while 41% said close relatives have a right to the majority of their estate (down from 72%).

It isn’t immediately clear why these trends are emerging but key factors appear to be:

  • regulatory changes (stricter data protection rules in the GDPR and the impact of the Fundraising Regulator following the fundraising scandals of recent years);

  • the advent of new forms of individual giving such as crowd funding (although some of this is already counted as direct giving); and

  • a weariness amongst the public both for participation in challenge events and sponsorship of those participating.

The message appear to be, therefore, that charities need to keep working hard to refresh their approaches to fundraising from individuals including:

  • trying new fundraising methods such as crowdfunding, voice, social media or contactless;

  • revamping events and finding ways to make them more engaging (e.g. increased gamification and more eye-catching challenges); and

  • investing in long-term income generation through legacy programmes, even for smaller charities.

It looks like times will continue to be tough for fundraising from individuals for the foreseeable future but, at the same time, there is hope for those who invest in long-term fundraising and innovation. As ever, it appears the key is creative thinking and energetic delivery to keep people enthused about your cause and giving to it.

If you’d like to chat about your charity’s fundraising strategy please contact us at julian@almondtreeconsulting.co.uk to arrange free initial telephone discussion.