Website that rakes off £20million a year from your charity donations
THE JustGiving website is used by millions every year to help them raise money for deserving charities.
Many, however, are unaware that it takes more than £20million a year from fundraisers – while its boss has a £200,000 pay package.
The firm takes a cut of more than 6 per cent from almost every donation. Some of the money is spent keeping the site working 24 hours a day and finding innovative ways of raising more for good causes.
But accounts show more than £10million last year went on staff costs – with the website’s directors, technicians, sales and administration workers paid an average salary of more than £60,000. The boss of the firm earned a pay package of £198,000.
Last night charity chiefs accused JustGiving of ‘greed’, saying the fees were ‘hard to stomach’. One fundraiser labelled the site ‘JustTaking’.
Fundraisers can set up a profile on the site which includes a description of why they are raising money and which charity the funds will go to. People can then donate through the site
‘JustGiving should be called JustTaking!’
and write messages of support on the profile page. But many are unaware that so much of their money is taken in fees by the firm.
One appeal currently on JustGiving has raised £160,000 for a four-year-old boy named Sam who needs cancer treatment abroad that he cannot get on the NHS. But under JustGiving’s terms, the firm stands to make about £10,000 from his treatment fund.
JustGiving officially says it takes 5 per cent from donations. But the percentage is calculated after including a Gift Aid tax rebate, so the cut works out as more.
If you donate £10 to a friend’s fundraising page on JustGiving and it is eligible for Gift Aid, the taxman tops up the donation to £12.50. JustGiving then takes its 5 per cent fee from the £12.50 – which works out as 63p, or 6.3 per cent of the original £10 donation. There is then a card processing fee of 13p-17p.
On top of this, JustGiving charges subscription fees to charities if they want to use the site to raise money. Small charities raising up to £15,000 in a year including Gift Aid have to pay £15 a month, plus VAT. Larger charities pay £39 a month, plus VAT.
The fees appear far higher than those charged by competitors, such as BT’s MyDonate website and Virgin Money Giving.
Some £440million was raised for charities through JustGiving in 2016, up from £404million in 2015. Its donation pages do not declare the exact cut the firm will take, but include small-print at the bottom of each profile stating: ‘Charities pay a small fee for our service’ and adding a link alongside the words: ‘Find out how much it is and what we do for it.’ The firm insists it is more transparent than its competitors about the fees it takes.
JustGiving was launched in 2001 by ex-lawyer Zarine Kharas and AnneMarie Huby, a charity director.
Accounts show the highest paid director of JustGiving was paid a salary of £152,000 in 2015 with pension contributions of £46,600. The firm would not say which of the founders took this £198,600 package.
Miss Kharas has always been open that it is a ‘for profit’ company but said her motivation was to serve a ‘genuine social purpose’. In 2009 she said: ‘I didn’t set it up to make money. That’s an important distinction.’
Ashley Fulwood, chief executive of OCD-UK, said his small charity’s fees for JustGiving had increased last year by more than £300. ‘I understand they have to cover their overheads, but half of the money is going on wages,’ he said.
‘They are taking people’s hardearned money for themselves. It is greed. It is hard to stomach.’
In January one fundraiser advised using other charity websites, writing on Twitter: ‘JustGiving should be called JustTaking!’
JustGiving said its fees are reinvested in the firm so it can run the site efficiently and safely for charities. It said the money is used to create new fundraising tools, provide customer service and help charities analyse their successes.
The firm claims its competitors do not notify donors on fundraising pages that they charge a fee. Instead, donors have to navigate away from their fundraising page in order to learn about their fees.
A spokesman for JustGiving said: ‘More charities and fundraisers choose JustGiving than any other fundraising site because we help them raise more, net of fees.
‘Our small fee is systematically reinvested into creating the services and technologies that help good causes raise more money, and our investors have never taken a penny out of the business.
‘As a company, we have helped raise far more money for good causes than lower- cost or free options, which offer a poor service through lack of investment and let charities and users down as a result.’
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