Mobile Giving Update

(Editor’s Note: Mobile maven Katrin Verclas let us know last week that there have been some pretty positive developments on the mobile-giving scene since she last wrote about it for Giving 2.0 sister e-letter the FS Advisor in February. Here’s her latest update, in case you missed it at MobileActive.org.)

Mobile donations to nonprofits have been stymied in the United States — hampered by the high fees charged for text message gifts that are then billed to a mobile-phone customer.

When a donor gives to a nonprofit via text, more than half of the contribution goes to the telephone carrier, leaving less than 50 percent to the nonprofit — an unacceptable margin for most charities. Combined with low donation caps — no more than $5 per SMS (text message) with a total of five SMS for a $25 donation — and other charges for short codes and mobile vendors, nonprofits have determined that mobile giving is not worth it.

This is about to change. If the Mobile Giving Foundation plays its cards right, mobile donations via text message may just explode this year.

The Mobile Giving Foundation, a Washington-based nonprofit organization, recently brokered a deal with the four major carriers in the U.S., and with the United Way. During the Super Bowl football finale, the United Way aired a 10-second advertisement pitching viewers to donate via text to the organization’s Youth Fitness Fund.

What went largely unnoticed was the fact that the Mobile Giving Foundation managed to negotiate agreements with the carriers, which waived all fees, allowing the United Way to collect 90 percent of the donation (with 10 percent going to the Mobile Giving Foundation).

This has not happened before other than in major disasters like Hurricane Katrina and, more recently, the California fires, when the carriers waived their fees for mobile text donations to the American Red Cross.