Is The Third Sector Innovative Enough?

Are charities making the most of digital disruption?

Charitable organisations and non profits, collectively known as the third sector, are no strangers to innovation. Blue Cross, Cancer Research UK, Oxfam, RNLI and Samaritans are just a handful of the charities using disruptive technology to extend their reach and interact with a wider audience. The question is, are they using technology in the most effective way? What challenges have they faced, and how can they keep up with exponential digital change?

Tapping into technology

Just as in all consumer reliant industries, the third sector has adopted cutting edge technology and digital channels to connect with their networks. This has included Virtual Reality experiences like an RNLI expedition down the Thames, and Artificial Intelligence, which has been used by Arthritis Research UK through Microsoft’s Watson. One of the most important developments has been the adoption of alternative payment options. In 2017, Cancer Research UK installed 10 smart benches across London that offered WiFi and charging ports. Users could donate £2 via contactless payment while using the benches. Blue Cross launched a more mobile campaign by fitting contactless readers to the jackets of its guide dogs.

It’s not all about fundraising, though. Charities are also using technology to encourage fundraising but they are also using it to improve their own services. P3, for example, is a social action organisation that offers aid to rough sleepers. In the rural, remote coastal regions of Lincolnshire, P3 is using drone technology to seek out people who may be in need and send response teams with more accuracy and speed. So, charitable organisations are certainly experimenting with innovative new ideas… But according to the Charity Finance Group (CFG), they aren’t doing enough.

The case for contactless

Ironically, although fewer people now carry money, loose change donations remain a popular method of giving. The issue is that the transition from a cash economy into a digital one could see charities gradually lose a successful method of generating funds. This summer, the Institute of Fundraising carried out a study of its members which found that 74 per cent were yet to try out contactless payments. Despite the efforts of Cancer Research UK and Blue Cross, the majority of charities seem to be struggling to adjust to alternative payment options.

Unfortunately, pursuing new payment options can be costly. Many charities are plagued by limited resources, so incurring expense through novel technology is not something they’re keen on. The answer, according to the CFG, is for governments to offer free (or at least discounted) access to contactless tech. In the UK, the government has taken steps to clear the path for third sector innovation through grants, and the US offers similar grants for non profits of specified status. There are also groups like Transform Foundation which help philanthropic organisations to build a digital presence through events, funding and training. Charities know that the opportunities are out there, but it looks like they need help to realise their full potential. This doesn’t have to come from other charities or governing bodies – businesses could also work with the third sector as part of their wider social responsibility.

If charities are to benefit fully from disruptive technology and emerging digital channels, the barriers to entry need to be removed. This is where the government (and perhaps corporates) can help. If charities are not making the most of disruptive opportunities, it is not because they don’t want to. Contactless payment, as shown by the Institute of Fundraising, is just one avenue that they have struggled to utilise. As is often the case, the reasons boil down to cost and risk. Are the potential advantages worth the time, effort and money? As the economy moves away from traditional cash donations, charitable organisations are left with little choice. They need to adapt now, and for good.

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