The race for online giving

By John Copps 10 May 2010

A few Sundays ago I stood outside my house and watched a parade of sweating rhinoceroses, Wonderwomen and Bob the Builders pass by.

I am, of course, talking about the London Marathon, the largest annual fundraising event in the world, in which thousands run 26 miles through the capital every April.

Although the event is also run by the world’s top athletes, this year the fiercest competition was not on the streets but online – where an increasing amount of the donations are made and collected.

The battle was between the websites Virgin Money Giving and the popular and ubiquitous JustGiving. The two were vying for a share of the millions of pounds of sponsorship pledged to charities by the friends, families and colleagues of those running the race. JustGiving has been around for almost a decade but this Virgin Money Giving’s first marathon, after it was launched last September to coincide with Virgin’s sponsorship of the event.

According to figures released a week ago, more than 9,000 runners raised money through Virgin Money Giving compared to 15,000 for JustGiving. Between them, the two sites expect to account for £30m of sponsorship.

Online giving has been a fantastic innovation in fundraising. It has raised millions of pounds of extra money for charities by making it easy for donors to support charities and efficiently processing donations. For this, JustGiving – which pioneered this approach in the UK – deserves huge praise.

But this hasn’t stopped some people from being sniffy about its success, because it also makes a profit by charging fees to charities and collecting a 5% levy on donations. Personally, I don’t have a problem with this and I think it would be wrong to begrudge its achievements.

That said, JustGiving seems to have had the market to itself. So it is interesting to wonder whether the figures released yesterday show the beginnings of Virgin Money Giving wresting some of the control of the market from Justgiving. Virgin Money pledges to be ‘not-for-profit’ and charges a lower rate of 2%.*

A deserved well done to JustGiving for its pioneering work, but I am pleased to see some genuine competition. As far as I can see, donors now have a choice, which can only be a good thing. As online giving continues to grow, hopefully we can see millions more raised for charity.

* So, after subscriptions fees, a typical donation of £10 that is eligible for gift aid and made with a credit card is worth £11.92 to a charity using JustGiving and £12.48 for a charity using Virgin Money Giving.