The whole world is turning towards the use of digital technologies and fundraising is no exception. More and more fundraisers use machine-learning algorithms, targeted messaging systems or crowdfunding platforms when seeking financial support from individual and corporate donors. With digital tools, civil society organisations (CSOs) can reach out to a wider group of potential donors and fundraise across borders. At the same time, the use of technology can also amplify the risks connected with fundraising, such as occurrence of fraud or security and data protection breaches.
We at ECNL are closely monitoring and supporting the technological development in fundraising. In April this year we launched a research about the opportunities and risks of using digital technologies in fundraising. Throughout the year, we also organized a series of expert discussions to develop a guidance on the use and regulation of such tools.
In October 2021, ECNL organized a digital fundraising webinar open for all interested CSOs. The purpose of this webinar was to raise awareness about the potential and risks of digital fundraising among interested CSOs. It also provided a platform for CSOs to exchange their experiences and challenges when engaging in digital fundraising.
During the webinar our fundraising expert, Usha Menon shared some inspiring tips on how CSOs can make a difference when raising funds via digital means. According to her, the best way to learn is to ask and have a clear call for action when designing your outreach campaign. While these might be considered straight forward they are oftentimes neglected during fundraising. In addition, she raised the importance of working with data that CSOs have in hand, as long as they abide by applicable privacy legislation. For example, website analytics can help CSOs direct more visitors to their website when using the right keywords. She also encouraged the participants to use different digital tools to stay in touch with donors, such as by designing apps, writing blogs or distributing surveys.
Usha shared practical examples of how digital tools can be used for supporting philanthropy. One of the examples demonstrating the power of livestreaming was the fundraising campaign organized by Dr. William Wan who did 73 push ups at the occasion of his 73rd birthday to support inmates and ex-offenders in successful reintegration into society. As of now, he raised over USD 116,000 for this cause and others around the world follow his example. Another great example was a joint initiative of technology company Say It Now and advertising company DAX. These two companies teamed up to enable users of Alexa to donate to CSOs via voice commands. After hearing the ad, users will be given an option to learn more about the CSO or directly donate by using a verbal instruction.
The use of digital tools in fundraising may also create potential risks. During our webinar, Boris Strecansky presented examples of some of the most prevalent risks when using digital fundraising tools, including algorithmic bias. Bias is a natural part of human decision-making. When using complex algorithms to, for example, target potential donors, without knowing how they were built, there is a risk to amplify such human bias. There are also risks connected with the use of personal data, especially when talking about access to personal data collected by major fundraising intermediaries, such as social media platforms.
Some of the participants shared their experiences and challenges they face when using digital tools for fundraising in their countries. Several people mentioned the lack of trust and fear of fraud by the wider public. They also experience challenges with financial inclusion due to the arbitrary implementation of anti-money laundering policies by the bank institutions. Another challenge in using digital fundraising is the lack of skilled personnel that would be trained to use digital technology in fundraising.
Participants raised another important point. In case of traditional fundraising methods, fundraisers generally know how to build a trustful relationship with the donors. For example, when conducting street fundraising, we know that we do not knock on the same door twice when being sent away by the homeowner. However, building trust while conducting digital fundraising is a whole new challenge that requires special considerations and must be addressed separately.
Recognizing this, we formulated a set of Good Practices in Digital Fundraising for regulators and fundraising practitioners as an outcome of these discussions. It aims to create some standards that CSOs and all stakeholders can consider and follow. They are based on already existing international and regional standards and/or good practices we have observed through our work and in discussion with fundraising experts.
We hope that our Good Practices in Digital Fundraising will help CSOs to navigate in the world of digital fundraising and enable them to build lasting relationships with donors. As digital fundraising rapidly evolves, we consider this to be a living document subject to regular updates. We will be happy to stay in touch with everyone who is interested to input to the document, provide feedback on the practical implementation of the practices or suggest any new good practices to be included to the list.
Stay tuned for updates about the Good Practices in Digital Fundraising as well as about ECNL’s activities supporting the development of philanthropy by following our website!
Do not miss out our next event about the anti-money laundering and counter-terrorism financing policies and their impact on philanthropy! If you have time on 29 November 2021 at 11 AM CET, register here and join our discussion with a great panel of experts from ECF/Dafne, Konekt and TUSEV.
For more information about our activities around the promotion of philanthropy, follow ECNL’s updates on Twitter or LinkedIn under #standards4giving.
Our activities promoting the development of philanthropy are organized as part of the ‘Sustainable Framework for Public Fundraising’ regional project, managed by ECNL. The project is made possible by the International Center for Not-for-Profit Law (ICNL) through the Civic Space Initiative. They are also organized within the framework of the Action “CSO Meter: A Compass to Conducive Environment and CSO Empowerment”, implemented with the financial support of the European Union.