Mobile Giving: The Next Revolution

The next revolution in fundraising will not be transformational. It will be transactional. And it’s arriving sooner that you think.

Last week, I paid a 65-year-old cab driver and, as usual, handed him my credit card. What happened next was unusual. The cabbie swiped my card though a Square payment device attached to his iPad, texted the receipt to my cell phone and updated the payment instantly in the taxi co-op’s financial systems. The entire transaction lasted about 10 seconds.

This took place not in Midtown Manhattan, but in America’s heartland — Madison, Wis.

The ease of making transactions with mobile devices in the service and retail sectors will soon become commonplace in our arena, the philanthropic sector. As a result, the last major hurdles facing fundraisers wanting to raise small dollar amounts from thousands of donors — return on investment and the cost of transactions — will be shattered.

And fundraising will never be the same. Imagine:

• A 15-year-old girl who jumps rope for five hours to raise money for the American Heart Association no longer needs to cajole her friends’ parents for their donation checks. She attaches her Square card reader to the audio jack of her iPhone and — instantly — the donations are registered at the association’s headquarters in Dallas and receipts are sent to the donors electronically.
• A development officer with an international NGO plays a round of golf with a corporate executive interested in helping bring clean water to a poor community in Tanzania. Over lunch in the clubhouse, the executive agrees to a five-year commitment of $50,000 and hands his golf partner a credit card. Barely 20 seconds later, the first $10,000 donation is recorded on a handheld device, and dates are set for the remaining four payments.
• A Red Cross volunteer working the aisles during intermission at a benefit rock concert meets an individual who has Square Register, an app on his mobile device. In the time it takes to type “Red Cross” and a few other key pieces of information, the charity receives a one-time $100 donation.

The financial burdens all nonprofits face — overhead and fundraising costs — could soon diminish significantly. Rather than spending 25 cents to 50 cents or more to raise one dollar, many charities, especially those engaging volunteers effectively, will spend 3 cents to 5 cents.