Kamis, 03 Mei 2012

JustGiving waived fee on Claire Squires' page but does it really need to take 8% from a £10 donation?

JustGiving waived fee on Claire Squires' page but does it really need to take 8% from a £10 donation?

By Andrew Oxlade

PUBLISHED: 12:12 EST, 2 May 2012 | UPDATED: 12:14 EST, 3 May 2012

When the huge public reaction to the death of marathon runner Claire Squires became apparent, the reaction from JustGiving, which hosted her fundraising, should have been automatic: it should waive the substantial fee that it creams off donations.

But it was only late last Tuesday morning that the ‘for-profit’ company said the charge would not be applied - after an email from us and the start of a backlash on their own homepage blog, which was urging people to donate.

This evening, Claire’s fundraising total had hit £910,000, or £1.1million including the gift aid top-up from taxpayers.

Miss Squires collapsed and died less than a mile from the finishing line of the 26.2-mile course on Birdcage Walk near Buckingham Palace on April 22

Miss Squires collapsed and died less than a mile from the finishing line of the 26.2-mile course on Birdcage Walk near Buckingham Palace on April 22

JustGiving says it charges 5 per cent but this is applied after gift aid so the £55,000 it would have made works out as more than 6 per cent of public donations. On top of this, there's a 1.3 per cent credit card charge.

Consider if you donated £10 by credit card. The amount is topped up to £12.50 because of gift aid. The 5 per cent fee is applied - 63p - then 1.3 per cent credit card charge on the £10 - 13p - taking the total to 76p.

This means fees account for 7.6 per cent of the original £10 donation

Some of the people I’ve spoken to this week, on social media and in person, don’t realise there is a fee at all.

It’s hardly surprising. There’s no mention of it on the homepage and only a small reference way down at the foot of each giving page, which most donors are unlikely to see.


JustGiving pioneered this method of online giving a decade ago but now it’s the supine encumbent, surpassed by far cheaper rivals, such as Virginmoneygiving.com, Bmycharity.com and Charitygiving.co.uk.

Virgin Money, which is not-for-profit, only charges 2 per cent on donations and not on gift aid, and Bmycharity.com applies no commission, just a flat charge on card payments.

They also charge the charities a lower fee than JustGiving just to register to accept donations. [Read the story on Justgiving and its cheaper rivals].

It's big business for JustGiving. Consider that the London Marathon raises more than £50million a year. JustGiving will account for a large chunk of that each year - and take 5 per cent.

JustGiving claims its revenues help to hone the process of giving and help it make more money for charities. It claims to have raised £770million since 2000, which should mean earnings of £38.5million for the company. It insists £14million has been 're-invested in technology alone'.

Presumably after the staff are paid - there's 72 of them - there's potential for decent profits.

To be fair, innovation should be encouraged and rewarded when it contributes to the common good.

But for the sake of transparency the company should declare its cut of each donation during the actual payment process and publish its annual profits on the website. And just maybe it should take a little less.

Here's what other readers have said. Why not add your thoughts, or debate this issue live on our message boards.

The comments below have not been moderated.

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They deserve their cut, and if people don't like it they can put their money where their mouths are and try setting up a 'free' alternative, demonstrating just how easy it is to run a big operation, employ 72 people, and deal with GiftAid administration with no income. - Clive, Fife, 02/5/2012 22:29 Why would they need to set up an alternative operation, there are companies alraedy out there doing the same job for much less money that money grabbing Justgiving. I predict that JG will be taking a lot less of people's money in the future, and hopefully articles like this will speed the process along.

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I was going to donate but it quickly became clear that Samaritans was going to get an awful lot of money and I donated to the Claire Lomas appeal instead. I checked the Just Giving site carefully and knew exactly what the deduction was going to be before I pressed the final 'send' button. Claire Lomas is the young woman who has a broken back and who is walking for Spinal Research and will not finish for about another week. Another really worthwhile cause.

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Just a guess but how many of the above comments do people think have been posted by employees/owners of Justgiving. The article was mainly about the level of charges and transparency. Justgiving should perhaps do a little less taking.

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A good business idea why knock it, people want paying, nobody does anything for nothing!

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Does anybody know how much the number 1 person pays him/herself? Charirtie's pay themselves an awful lot of money, far more that people realise.

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Perhaps it would be more sensible to scale and or cap the fee on amounts raised. The credit card fees costs to them alone will be close to 2%, thats if that is not deducted as well before passing to charities.

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Typical Daily Mail. If Claire hadn't have set up this page there would never have been the huge influx of donations. Before Justgiving people would collect probably about £100 by passing around paper forms to fill in. Justgiving has changed that. You're naive to think that it should be done for free or not for profit. They state on every single page that they charge. Join the real world Daily Mail.

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Justgiving has revolutionised and simplified the way both people can give money and charities can raise it. Businesses such as this provide a service that requires massive infrastructure and development costs. The 5% fee is well below what traditional fundraisers charge and is in most cases claimed back from gift aid. Any profit the company makes is in my view well deserved.

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It provides a service that is convenient so I don't see why they shouldn't take a cut. Like Clive from Fife has said if you don't like using them use a different service. Overall, I think in the longrun it's probably generated more for charities because it is quick and easy than if it didn't exist at all.

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Service providers need to cover their costs - agreed. But there are alternatives to justgiving. Most notable is the NOT for profit Virginmoneygiving which takes just 2% of the donation (not the gift aid contribution).

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