Millennials and crowdfunding
Recent research shows Millennials are nearly twice as likely to donate to charity than those aged 55+ (79 per cent compared to 42 per cent)1. There are currently 13.8million people in the UK aged between 18 - 35 2 and as the UK's number one source of charitable donations, this generation is firmly in the driving seat when it comes to reshaping the third-sector.
With trust in UK charities at a record low, people are relying on donation-based crowdfunding to help fulfill fundraising targets, which could remove charities from the equation all together. The research proves that millennials are a generous generation, however, they are also very money-savvy and aware that direct donations to individuals are the best way to ensure their money is being donated to the cause that they want it to.
Half (50 per cent) of 18 - 24 year olds and 40 per cent of people aged 25 - 34 would prefer to use a crowdfunding platform to donate money directly to individual than donate via an established charity organisation. When questioned on why they would not donate directly to charity organisations, more than a third believed that only a small amount of their donation would go towards supporting the actual cause. A further 37 per cent of 18 - 34 year olds stated that they don’t trust the source or organisation collecting it.
A report by the Resolution Foundation highlights the UK’s growing intergenerational divide and reveals that Millennials don’t have as much expendable income as Generation X. In fact, Britain’s current young generation earned £8,000 less than their predecessors.3 As a result, they are hyper-conscious of how the money they do donate is being spent. We’re seeing that Millennials are increasingly starting their own fundraising pages for individual causes that they have sourced themselves and strongly believe in via crowdfunding platforms.
The need for transparency is becoming a pressing issue, we now have the ability to donate to specific causes in a matter of minutes from our phones and crowdfunding is becoming an effective, efficient tool for collecting money from the masses, particularly the tech-focused younger generations. Millennials are now successfully completing the donation cycle entirely by themselves, from start to finish, and in doing so they know exactly how much of the money they raise is going to the actual cause. Crowdfunding fits when and why Millennials want to give and provides reassurance that there’s a real person at the other end, a genuine cause.
Charity organisations need to get ahead of the game, reconsider who they are targeting and change their tactics accordingly. The loyalty and voice they cultivate lays the cornerstone for future fundraising campaigns. It’s clear that Millennials really do care about those in need and want to donate to causes they believe in, organisations that do a good job of engaging them now will reap the benefits in time as they earn more and therefore have more to offer.
Leetchi.com, the leading online money collection site with more than 6 million users in 150 countries and a team of 65 employees. The Leetchi Group forecasts that more than €400million will be raised using the platform in 2016.
The Leetchi Group offers high quality, innovative money solutions via the commercialisation of its MANGOPAY API, developed to answer to the strong market request for C2C payments. MANGOPAY is a provider of payment solutions dedicated to collaborative players such as marketplaces and crowdfunding platforms, and currently services over 1,500 client platforms across Europe.
Today, Leetchi.com is available in four languages: French, English, Spanish and German, and people can contribute to a money pot from over 150 countries.
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