Charitable Funding May Decline in 2021 & What Charity Organizations Can do About it

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The pandemic has affected charities around the globe, including Israeli charities like Yad Ezra. Although it has been amazing to see communities around the globe come together and support their local and regional causes throughout the pandemic since the first quarter of 2020, it has also been noticed by charity runners to see the impact of the prolonged global crisis on the ability of people to continue with giving charity.

At first, it seemed that the pandemic had not dented the charitable donations from wealthy businesses and families. In 2020, a majority (90%) of the most affluent American households gave money to charitable causes as a direct response to the pandemic. In the first half of 2020, people were willing to donate more than in the past and focused on meeting the primary needs of their local community.

At first, the donors’ resilience and sense of commitment served as a reinforcement of their giving spirit; however, recently, it has been speculated that charitable donations, gifts, and funding are prone to decline in 2021. It has been suggested that nearly 30% of non-profiteering organizations could shut down as a response to the decline of funds and donations.

When it comes to the essential barriers that are refraining people from donating, they include a lack of transparency on the ways the money of the donors is used and a lack of closeness and relevancy to the cause.

What are the impacts of the decrease in charity?

Since the start of 2021, different charity organizations around the globe have been witnessing a visible reduction in the numbers of impromptu donations as compared to 2020, which really had massive impacts on small-scaled charities. While realizing the importance of their regular donors, charities are also anticipating that fewer of their regular donors would be willing to come on board.

While larger and long-established businesses are better positioned to fill in the funding gaps, the funding sources are at the brink of drying up sooner than one can think. Without substantial funding, charity organizations will encounter real struggles to assist their community during the present and future.

 

What are potential ways to boost fundraising efforts in 2021?

By understanding that we are moving on a different landscape, charity organizations can integrate certain trends to boost fundraising efforts. For instance, as everything has turned digital, the way donors donate their money has changed, so more attention needs to be paid to digital fundraising.

Since 2020, online channels have become the primary means of communication, and many charity organizations were successful in raising funds online. The need of the hour is to better integrate digital engagement and establish a strong social media presence along with encouraging conversations and discussions amongst supporters.

Charities also need to understand the importance of transparency to ensure that the donations keep coming. To add value to your donation appeals, explain to the potential donors where their money is going and how their money will bring value to real people. The use of testimonials and real-life stories can be very useful.

Due to the pandemic, the strategies of charity organizations have changed as well, and remote teams are more common than before. Charity organizations can understand that their donors are facing fewer resources and even a tighter budget, which is why their fundraising strategies need to be as flexible and accommodating as possible.

Charity organizations can land new donors by asking their previous, one-time donors to re-donate as recurring donors by thanking them and showing them how much their charity helped the organization, people, and community, and how much better everyone could get with another donation.

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