09 Mar 2015

A question about : Justgiving: profit in disguise

We sat down this afternoon to make our annual donations to various charities, including Ј150 + Giftaid to the Simon Community. After we made the donation we noticed the money went to a company called Justgiving and at first thought we had been scammed.

We re-opened the Simon donation page and realised the only mention of Justgiving was the name on a strip across the page. Research reveals that Justgiving is a trading name of Giving Ltd. which makes over Ј1 million a year by raking off at least 6.5% of our donations.

I make no comment on whether Justgiving offers value to the charity or whether the Simon Community should use a less expensive provider. My wife and I do feel misled by the Simon Community webpage in that we thought we were helping the Simons and not some fatcats in London. This sorry tale has led us to question the whole charity industry.

Best answers:

  • Well evidently the Simons have reckoned that paying 6.5% to Justgiving is better than trying to do the job themselves and making a botch of it.
  • If you went through the Simon Community website it would have told you:
  • That's my point -- we did go through the Simon Community website and saw no reference to Justgiving until we reached the secure donation page, unlike the other charity sites where we have also donated. (In our innocence we thought we were helping a local charity.) For example, some Service charities use Bmycharity which does not take a rakeoff for handling donations. We've also found more about Justgiving, which we had not heard of, and found that its chief executive is paid Ј150k pa and that its profits have fallen from Ј3.5 million to Ј1 million 2011/2012. Hard times for everyone I suppose ...
  • Justgiving is pretty famous. I believe that charities that use it find it cost effective and benefit from an increase in donations due to the ease of giving.
    Nothing in life is free in the long term. You also seem to blur the line between income and profit.
    Justgiving was founded in 2000 and didn't make profits until 2006. By March 2012 it had collected Ј1bn for charity (with costs/profits of a small %age of that number). Justgiving also makes it easy for charities to reclaim giftaid - this is one of the reasons why charities get more money this way.
    Traditional charity donators are middle aged and above. Justgiving - with links to facebook and use of the net - has seen increases in donations from the younger population.
  • You never heard of JustGiving? Well they are pretty big and a good platform for many charities.
    They offer many ways to donate and they take away a lot of admin job away from the charities (which is a cost saving). Gift aid is an expensive process and they also track it for charities as said above.
    As for the salary of the CEO, well i'm afraid, for London, this is even a low salary. Plus there are many charities paying similar salaries to their executives.
  • Hi there, I lead a Charity Group at work, raising funds for employee nominated charities each year. With JustGiving, the Virgin equivalent, CAF etc. there is a processing fee. It might seem steep or unfair to have to pay, but having spoken to charities, it works out cost efficient to them because they have a company who is handling the processing of donations, calculating and claiming the tax relief etc. If a donation is eligible for gift aid, by the time you take off the processing fee, they are still receiving over 100% of your original donation.
    Not sure if you are employed, but it could be worth asking your employer what their charitable process is? I am very lucky as my company match all employee donations and we gift aid as well, using CAF. We have the option to donate at source, so a Ј10 donation to charity costs an employee Ј8, or Ј6 if a 40% taxpayer, plus gift aid is added on top. I've encouraged a large amount of employees to route their standard monthly/annual donations through this way to get a huge benefit to charities.
  • Our thanks to everyone for your explanations and views. As you gather we are past middle age, non-techie, and well out of touch with today's billionaire charity "industry" and its fundraising methods.
    We have decided to use Bmycharity for future donations, avoiding the rakeoff by third parties. Otherwise we are sending old-fashioned cheques to charities based in our local area rather than national organisations many of which spend 25% of our donations on raising even more funds ... but then as I said, we're old-fashioned.
  • All donation processors charge fees of some sort. Bmycharity has a low processing fee for the individual donation but a higher joining fee for the charity.
    Running a charity effectively always entails costs. Good charities balance fundraising and administration costs with the sums they need to raise to achieve the results they are seeking.
    Charities pay landlords, printers, web design companies, rubbish collectors, accountants and much more. The salary of the CEOs of these companies is irrelevant to the work of that charity.
    What is important is that charities seek value for money in their purchasing.
  • I wouldn't stop supporting a charity just because they use justgiving. Although some big charities do use justgiving it's often small ones who could never otherwise take donations by credit or debit card as you need a big income (and a member of staff or volunteer) to do that.
    Did you know you can look charities up and see their income and how they spend it? This is the one you helped http://apps.charitycommission.gov.uk...idiaryNumber=0
  • Virgin money do not charge.
    I absolutely will not donate to a charity via justgiving out of principle. If I wish to donate to the charity I will do it directly.
    I feel people use justgiving as they do no research into their options. And this make the bosses of justgiving very rich.
  • Thanks vikki for that link, and for the Virgin one dave.
    I've been trying to get around to writing my Will and i'm reluctant to leave anything to a Charity were much of it will be creamed off in commissions to fund raisers.
  • Here is what Virgin Giving says about their charges:
    "We only charge what we need to cover our operating costs.
    Just one Ј100 + VAT set-up charge, and 2% of donations. That's it.
    We don't charge an ongoing fee to be on our site and there are no monthly or annual fees. Plus we don't charge to collect Gift Aid.
    So more money goes where it's needed - directly to your charity."
    Virgin Giving is still a good deal for charities even with the charges. The last charity I worked for subscribed to Just Giving and Virgin Giving. The rational was to make it as easy as possible to donors, offering them whatever mechanism they wanted to use.
  • Hi,
    I am in the process of organising a Charity Summer Ball. This set off as a major family celebration for my Mum's 90th Birthday but somehow it multiplied big time and I've ended up putting on a big charity event!
    As a family (and because of close family ties) the event is to raise funds for
    The Special Care Baby Unit at Scarborough General Hospital (my daughter is a specialist neo natal nurse/ward sister there) and they are short of funds to replace old worn out equipment and short of specialist trained nurses.
    The Neo Natal Intensive Care Unit at Hull Royal Infirmary (my daughter did part of her training there and it is also the centre where very small / ill tiny patients are sometimes sent from Scarborough SCBU)
    MacMillan Cancer Support - I am a Cancer Sufferer, my Mum is/was and my late Dad had Lung Cancer - without MacMillan I would not be there.
    The charity Ball has been set up under a Trust Fund to benefit the 3 charities equally.
    Someone suggested I create a Just Giving Account so contacted them and explained the Ball framework and the fact all 3 charitable causes will get an equal share of what the Ball raises along with an equal share of any other funds raised.
    However Just Giving do not allow you to have "an umbrella account" but you have to have a seperate page for each charity so people can donate to their preferred charity.
    As a result the 3 charities the ball is for would not receive an equal share of my family's efforts - so I am not going down Just Giving Road.
    Although I have to say having read the previous posts on this thread I am pleased I haven't created a Just Giving account for each charity - they would lose out. So thank you to whoever started this thread
  • I'm not keen on Just Giving and their ilk either, but, I suppose, the end result is similar - if you give via a donation site, they do some of the admin and take some of your donation; if you give direct to a charity, they do some admin which is usually paid for out of donations.
    Overall, as long as the fees are clearly stated, it's up to the donor.
    Those mailings you get through the post with address stickers or greetings cards or a pen... even though the materials are paid for by sponsors, if I was the sponsor, Id want my thousands of pounds to go on the charity's work, not on getting small donations out of guilt-tripped grannies' pensions.
    Now, I really dislike chuggers...