By Thom Aldredge
The Give Back Campaign Inc.
If you are a "1 percenter" or a "2 percenter," it is likely you are helping to carry the "99 percenters" of this country. I'll explain. Per the World Giving Index, the United States is the most generous country in terms of the dollar value of donations, an amount that surpassed $335 billion in 2013. Yet with the largest economy in the world (not yet, China) the rate of giving based on gross domestic product has been stuck at around 2 percent for over 40 years.
According to Giving USA, 72 percent of all monetary giving comes from individuals. The highest-income individuals have a disproportionately higher giving rate than the 99 percenters. Nonprofits should "occupy" Main Street, not Wall Street.
As income disparity shrinks the middle class, you and I tend to take care of our families and ourselves first. Governments dealing with burgeoning deficits have less in their budgets for all societal needs. And with more than 1.5 million organizations in the United States classified as charitable, it's difficult to allocate something for everyone. There is more need, but resources are not keeping pace.
For most of us, charitable giving is a personal endeavor. Charitable acts are in our DNA – from our experiences, our upbringing, our desire to benefit our communities, our willingness to share. But we dislike being hounded by groups asking for money. We don't want to be told how much to give or to give at all if we don't want to. Our giving is discreet, primarily to organizations that have touched our lives, that we have affinity for, that embody causes we align with.
In 2013, U.S. expenditures for final goods and services (buying groceries, launching satellites, planting trees) amounted to more than $16 trillion. One additional percent of this amount, tacked on to the $335 billion we already give as a nation of 2 percenters, would generate an additional $162 billion of giving, pushing toward a total of half a trillion dollars. Allocated evenly among those 1.5 million charitable groups, that's about $330,000 per organization, per year: 3 percent.
Most giving programs today target only one cause, one charity, for a specific time. They are based on the premise of the "ask," which can become tedious. Think of The Salvation Army, the holidays and your pay stub. To get to the next level, fundraising needs to source a more pervasive pool of capital, one that subtly shifts a mindset and engages giving at a steady pace.
With giving programs tied to card processing, each of us can tap our personal buying power to generate donations to the charities of our choice. Our groceries, gasoline, dining out, cell phone bills, salon visits – just our regular daily, weekly, annual spend – the merchants, businesses and organizations we patronize can be conduits for our giving. We agree to spend, the businesses agree to give and the charities of our choice receive.
We can select a different charity for each purchase. Businesses that commit to donating a set amount from each purchase, say 5 percent or $1, can acquire the tax deductible benefit of the donations. Charitable organizations can promote participation in the program to drive customer traffic and help market the benefit. Consumers get text notifications of transactions, businesses receive monthly accounting and tax receipts and the nonprofits track giving totals online.
It's a win-win-win scenario for consumers, businesses and charities. But this type of campaign needs businesses to join in, and this is where the payments industry can help. Processors, ISOs, value- added resellers, banks, etc., can educate their customers about giving. They can recruit the charities they support to join. They can target their communities. The goal is universality. And 3 percent.
Thom Aldredge, Managing Director for The Give Back Campaign Inc., has been a payments industry member since 1999 with World Gift Card, BAMpay and SignaPay. Giving back to the community is important, and he hopes The Give Back Campaign will energize the payments industry to help "add the 1 percent."
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