THE BLOG

Charitable Giving in a Cashless Society

15/02/2013 11:40 GMT | Updated 16/04/2013 10:12 BST

We all know times are tough, and with the news of continued austerity measures it doesn't look like that will change any time soon. The voluntary sector, like many, has been hit hard during the recession and the latest figures show that this is even worse than previously thought. Last month the UK Giving Report stated that donations had fallen by 20% in real terms in the past year, with £1.7bn less being given to charity. The number of people donating to charity has also fallen.

A decline in giving is not surprising in the current economic climate, but such a dramatic fall was unexpected. A number of reasons for this have been advanced. One opinion which merits closer examination is it is not as easy to give as it used to be. Fundraising techniques are not keeping up with the way our lifestyles are changing with cards overtaking cash as the preferred payment method for the first time in 2010.

Research conducted by Pennies earlier this year found that a third of us now go out regularly without any cash at all, supporting the shift towards a cashless society. In fact 5% of those surveyed said they now live a completely cashless existence and that rises to 10% amongst 25-34 year olds.

Traditionally, dropping a few pence in charity boxes has always been a popular way to give. The UK Giving Report found that giving cash is still the most popular donation method. However in recent years we carry less cash and charity boxes are not as evident.

The result? The popular charity box was in need of a makeover, and that is exactly what we have given it at Pennies. Two years ago we took micro-donations digital, giving people the choice to give a few pence to charity when paying by card.

When we launched with our first retailer, Domino's Pizza we weren't quite sure whether the public would give. But they did and have now donated in their millions. The number of donations received grows every week, as more and more businesses join the Pennies movement. Last week alone Pennies collected 100,000 micro-donations.

I believe this demonstrates that the British public remains generous. People are just looking for new ways to give that fits in with their lifestyle and budget. They may not have much disposable income, but are happy to give a few pennies to charity when they can.

My job gives me the opportunity to meet people from all walks of life who often tell me what will keep them giving to charity: they want it to be easy to do, pennies not pounds without an ongoing commitment and they don't want to feel pressurised into giving. Our annual research for the past five years supports these findings. Of course they also want to believe in the work the charity is doing and feel they can easily find out the impact of their work and how their money is being spent.

In developing Pennies, we have kept public opinion at the forefront of our thinking and the positive response confirms that we are on the right track. It is still very early days but on average 20% of customers offered the choice to give are doing so and that rises as high as 50% in some retailers.

This shows that innovation in the sector is working and is crucial to ensure that charities keep up with our changing way of life. Pennies is certainly not alone in this field, with a number of charities, social enterprises and organisations working on innovations for giving. And this trend looks set to continue. It is often hard for charities on their own, with reduced budgets, to adapt quickly particularly the small ones. This is why it is imperative that independent organisations work closely with business, charities and government to ensure that the fundraising climate continues to adapt to our changing behaviours.

I have no doubt that charitable giving will increase again in the future both through more people giving and giving more at a time! We should never under estimate the public's generosity. It is amazing. I believe that electronic micro-donations will help to capture pennies that otherwise wouldn't have reached charities to help them do what they do best. There are currently 43 million card holders in the UK if all of them gave just 30p a month it would raise £150 million for charities every year. We are now on track to hit the £1 million landmark after just 2 years, and that only looks set to rise as Pennies becomes available in more places. Even in these times of austerity we should remember what a difference a penny can make.