Non-profit sector is increasingly feeling a need to have professional fund-raisers in order to maintain the functions smoothly, attain financial stability and sustainability. The problem lies in a lack or shortage of such professional fund-raisers. Earlier, most of the NGOs have been receiving foreign funds. However, with more stringent monitoring, FCRA regulations (Foreign Contribution Regulation Act), western economic downturn and a shift in India’s international standpoint regarding foreign funding agencies, there has been a sharp decline in the amount and frequency of foreign funding.
Because of this, NGOs are facing shortage of funds, and are now looking for other domestic and local sources. So far, because of pre-determined fund flow, there has been complacency in terms of putting in efforts, getting trainings and professional outlook for fundraising. The scenario is changing fast because of the new (2013) amendment of the Indian Companies Act. As per the clause 135 of the Companies Act, 2013, the CSR provision within the Act is applicable to companies with a specified range of annual turnover, which have to spend at least 2% of their average net profit in the previous three years on CSR activities. This section is now implemented from the fiscal year 2014-15, and thus it is resulting in a new and massive source of funds for NGOs, the corporates.
In addition, this situation is resulting into mushrooming of the ‘mediating agencies’ between donors and receivers (NGOs). The problem lies in no professional training and up-gradation of fundraising skills of NGO sector. These mediating agencies are selling ideas to the corporates on behalf of these NGOs, thereby making some money in between.
On the other hand, the most useful and dynamic platform of fundraising is taking the centre stage, which is ‘Internet and Social Media’. The lessons for the NGO sector in India are very clear in the current context.
The non-profit sector needs to upgrade itself and engage in hands-on use of this powerful medium of fundraising, while also a mode to spread the word about the good work. Digital media is a huge opportunity to be tapped, but it is also dividing the development sector into ‘haves’ and ‘have-nots’. NGOs and development professionals who are able to make use of this medium are gaining funds, support, volunteers and other resources. The “Daan Utsav” is a very appropriate example of how NGOs can make best use of digital world to raise resources. Many NGOs were able to raise huge amounts of funds, and also to engage volunteers in thousands because of this event.
However, the NGOs who do not have accessibility and skills to utilize the digital media have remained unaffected by this surge. To conclude, there are new and huge opportunities for fundraising available for the development sector now, but the need of the hour is to engage professional fundraisers, utilize the digital media, to build own skills and to widen the knowledge for harnessing the untapped financial and other resources locally as well!
