The changing fundraising landscape and the prospects for NGOs to pool resources:
Fundraising in India has a diverse and ancient history, which is rooted in cultural, religious, and social values. In ancient times, kings, wealthy merchants, and individuals supported temples, ashrams, and educational institutions. Generous donations were made to support religious and spiritual endeavors, as well as community welfare initiatives. Charity and philanthropy were ingrained in Indian society, guided by the principles of dharma (righteousness) and seva (service). During colonial rule, Western philanthropic practices influenced fundraising, leading to the establishment of philanthropic organizations and formal charity structures in the country. In fact, fundraising has played an integral role in India’s freedom movement, with people contributing material wealth to support the cause of independence. The Gandhian philosophy emphasized the transformative power of philanthropy, not just as a means of immediate relief but as a revolutionary force for creating lasting change. As industrialization took hold, organized giving took on new dimensions, with prominent industrialist families like the Tatas, Birlas, and Godrej actively participating in philanthropy to support specific causes. These families contributed significantly to organized giving, leaving a lasting impact on the philanthropic landscape in the country.
After independence, fundraising efforts intensified to support nation-building and social welfare programs. The post-independence era saw the rise of NGOs and civil society playing a crucial role in fundraising for addressing diverse social causes. The Companies Act of 2013 made CSR mandatory for eligible companies which further fuelled fundraising efforts. With globalization and technology, online fundraising platforms and crowdfunding transformed fundraising practices, empowering grassroots initiatives. Impact investing and venture philanthropy gained prominence, attracting investors seeking both financial returns and social impact.
Fundraising in current times in India has witnessed significant changes and innovations, driven by technological advancements, evolving donor preferences, and the growing importance of social impact. Several trends and approaches have emerged that are shaping the fundraising landscape in the country.
Corporations are actively engaging with NGOs and nonprofits to support projects aligned with their CSR objectives. Strategic partnerships between corporates and NGOs have become more prevalent, enabling scalable and sustainable initiatives.
Impact investing, which seeks financial returns alongside measurable social and environmental impact, has gained traction in India. Impact investors, including venture capitalists and private equity firms, are increasingly funding social enterprises and startups that address pressing social challenges. This trend has brought new sources of funding to the social sector, encouraging innovative and sustainable solutions. The Social Stock Exchange (SSE) launched by the Securities and Exchange Board of India (SEBI) in 2023 is a novel platform that provides a new and innovative source of funding for NGOs and social enterprises in the country. Through the SSE, NGOs and social enterprises can list themselves and raise capital from socially conscious investors and impact investors who are committed to supporting socially impactful initiatives. This platform bridges the gap between traditional financial markets and the social sector, providing a structured and regulated mechanism for fundraising
The widespread adoption of the Internet and mobile technology has revolutionized fundraising in India. Online fundraising platforms, crowdfunding websites, and social media have become powerful tools for NGOs, social enterprises, and individuals to reach a global audience and raise funds for various causes. Digital campaigns, virtual events, and peer-to-peer fundraising have gained popularity, providing donors with easy and convenient ways to contribute. Online fundraising through paid promotion technologies such as Google Ads, Facebook and Instagram Ads, Affiliate marketing have gained prominence as effective means for NGOs to raise funds and engage with donors directly.
However, challenges persist, such as resource concentration in urban areas, transparency issues, and the need for capacity building among NGOs to effectively utilize funds.