Who you use to fundraise and donate money with can affect how much money the charity gets – so it pays to use an alternative to Just Giving.
- The problem with Virgin Giving and Just Giving
- Where your money goes when you donate
- Additional Charges to the charities
- Alternatives to Virgin Money and Just Giving
- BT MyDonate
- Other ways to maximize your donation
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When you donate on one of the big fundraising websites, you’d think all your money is going to the cause you’re supporting. Well, it doesn’t.
Your donations are all subject to transaction fees. I was reminded of this last week when I sponsored a mate doing a half marathon and spotted by £10 donation was actually £10.50. And that’s not the only way these companies take cash away from charities – the biggest platforms Just Giving and Virgin Giving both charge charities to be use their platforms.
Only Just Giving doesn’t claim to be not-for-profit. Instead, it says all profits are put back into improving the technology to help people fundraise, such as allowing you to donate by text message. And as for the rest… ok, so they’ve all got to cover their costs of staff and operations. And, yes, this money does have to come from somewhere.
Even so I’d thought the money I gave all went to the charity so I was pretty shocked when I found this out a few years ago. But as with most things, a little shopping around can maximise how much of your cash actually goes to the good cause
First though, here’s why I think you should avoid Just Giving, and to a lesser extent Virgin Giving.
Where your money goes when you donate
You’ll be relieved that most of your donation does go to the charity – but not all. Virgin Giving and Just Giving, along with many others, charge a card processing fee and a transaction fee.
Both do give you, as the person donating, the choice as to whether you pay this fee or whether it comes out of your donation – but either way the charity is losing out on cash – and it can be considerable, especially with Just Giving.
Here’s the real cost of a £20 donation to each one.
How much money Virgin Giving takes from your £20 donation
- Card processing charge of 1.45% = 29p
- Transaction fee of 2% = 40p
- Total cost per £20 = 69p
The card fee actually goes up to 1.6% if you use Paypal or American Express.
Total to charity after Gift Aid = £24.31
How much money Just Giving takes from your £20 donation
- Card processing charge of 1.25% = 25p
- Transaction fee of 5% = £1
- Total cost per £20 = £1.25
The card fee goes up to 1.45% if you use Paypal.
BUT there’s also a 5% charge for the charity to claim back any Gift Aid you add. So with a £20 donation, Gift Aid of 25% is worth £5, yet the charity will only get to claim 25p, so the charges really add up to £1.50.
Total to charity after Gift Aid = £23.50
Additional charges for the charity
Virgin Giving and Just Giving also charge charities to be listed on their platforms.
Just Giving charges a monthly fee of £39 + VAT for any charity that raises £15,000 or more in a year. For those which raise less the fee drops to £15 + VAT a month.
Virgin Giving meanwhile has a flat, one-off fee of £150 + VAT, though there is a “join for free” offer if charities sign up before 30th April 2019.
The alternatives to Just Giving and Virgin Giving
So, if like me, you want as much of your money to go to charity as possible, and for the charity to be able to use the platform without a charge, you should avoid Just Giving and Virgin Giving. But where?
Fortunately there are alternatives. Some don’t charge for anything, while a few others might have a transaction fee, but are free for the charity.
The major downside with most of these smaller platforms is just that – they are smaller. They won’t necessarily have your charity of choice on board, though it’s worth looking to see what your options are. Often it’s the smaller and local charities which need our support more than some of the giants.
Here are a few to consider:
I really like Wonderful as it charges nothing to the charity at all. Nothing. So all your money will go to the cause. IT can do this as it’s funded by philanthropic business donations.
BT My Donate
As the name suggests, BT My Donate is run by BT, who fund it entirely through their profits made elsewhere. There are thousands of charities listed, and it’s clear they don’t take any of your cash.
This looks like the site where the most of your money goes to the cause as even running costs aren’t taken from your donation. Card fees are 15p per £10.
BUT, and this is the bad news, it’s being shut down on the 30th June 2019 – though you can still use it until then.
With GoFundMe you’ll be charged 1.9% as a transaction fee, and 20p per donation to the running of the site. All the Gift Aid goes to the charity. So for a £20 donation, it’ll cost you 58p. Though it’s not much different to Virgin Giving, there’s no charge for charities to be listed.
Givey charges the donator 5%, so £1 for a £20 donation. But again the platform is free for charities to use. Further funding comes from business donations.
Other ways to maximize your donation
If you donate via your paycheck – often called Payroll Giving – the tax man actually contributes some of the money. So a Basic rate taxpayer would only contribute 80p for the charity to get £1.
Similarly, if you are a tax-payer you can add Gift Aid to your donations, adding 25%. However the charity has to claim this back, which can come with administration costs to the charity. But it’s automatic via Payroll Giving so it’s, in theory, better for the charity this way.