How Millennials Are Driving Charitable Giving's Evolution With Technology
2017 was a turning point in the U.S. According to the Giving USA Foundation’s annual report on philanthropy, Americans gave more than $400 billion—for the first-time ever—to a variety of causes near and dear to their hearts.
The unprecedented growth of online and social methods of charitable giving in just the last decade has been, by far, the biggest disruptor for the industry. With estimates that nearly 3.5 billion people used the Internet regularly in 2017, according to eMarketer, online giving has the potential to continue to increase exponentially.
The Evolution of Charitable Giving
The driving force behind charitable giving's evolution, as with many other industries, is Millennials (those born between 1981 and 1995/6). Not only did the Millennial generation wholeheartedly embrace online giving, they have pushed other generations to participate with charities and causes that are now readily accessible with technology. As a result, we have more methods than ever before to donate and have a voice in local, regional, national or global charities.
However, it’s not just Millennials’ expectations and demands of technology that have propelled charitable giving to an all-time high. While they may not be able to donate as much on average as the generations that preceded them, this particular generation is more passionate than previous ones in supporting specific causes and helping people.
Interestingly, their sense of giving goes beyond just how they are personally donating to charity. Millennials are also concerned about whether their employers are being socially responsible and if they allow opportunities to volunteer their time, as well as what charities the brands they consume support.
Long ago, before the days of online giving, your options for charitable donations were limited. Before the days of credit cards, you had to mail cash or a check to donate money to a charity. Then there were telethons and tele-giving. Later, we gained the ability to set up ongoing credit card payments online to donate monthly to our favorite charities. And with the rise of smartphone use, texting to donate to your charity of choice became one of the easiest methods.
With the popularity of social platforms, such as Facebook, charities have been able to set up nonprofit fundraisers to help raise money directly using shared media as a distinct advantage. The ease of social giving lies within never having to leave the platform to both donate and tell our friends about the cause we just supported. Now, however, we’re seeing yet another evolution in how we can donate our time and money to a charity.
The downsides of using more advanced technology has typically been plagued by higher transactional costs and a lack of transparency in understanding how donations are used by charities. While blockchain is infrequently discussed in the mainstream media outside of its use with cryptocurrency, the technology is revolutionizing many industries—including charitable giving. It has the ability to make charitable giving simpler and more efficient and transparent than ever before.
Blockchain technology may still be fairly unknown to the public. However, it has the capacity to ensure that any transactions for which a charity receives or spends donated funds are visible and unchangeable. This technology has the ability to restore public trust in charitable giving and push monetary donations and even volunteered time to even greater heights. With younger users, particularly those in the Millennial generation, more interested in cryptocurrencies and initial coin offerings, blockchain has the capacity to see greater acceptance in the coming years.
The blockchain can also be utilized to create reward-based systems with charities at the center. For example, at least 30 percent of donations each year come in the form of in-kind donations. However, in-kind donations may occupy already scarce storage and transportation capacities and consume valuable staff time and money to manage. Utilizing blockchain technology can help solve these difficult logistical challenges and aid charities by receiving donations of time.
Blockchain technology is the future of many industries. It can help solve many long-standing issues and help encourage both charities and donors. While the public won’t be swayed to blockchain overnight, ultimately, it is the next evolution in charitable giving.