By Ed Gairdner, COO of The Good Exchange

Charitable funders play a vital role in supporting charities and good causes, particularly at a local level, in communities contending with many years of cuts to local services from central government. Our own research ‘Technology in the Charitable Sector’ – in which 100 UK grant-making organisations, as well as 191 applicant organisations,  were surveyed – found that 58% of funders are seeing an increase in the number of funding applications they receive and 56% reported seeing more charities closing as a result of the government cuts to funding.

Austerity has become the new reality, and more pressure than ever is being placed on already overstretched grant applicants. Unsurprisingly, the results of our survey revealed significant levels of dissatisfaction with current processes and an increased appetite to embrace digital to reduce wasted efforts and enable collaboration to address societal issues, such as the ongoing impact of said government funding cuts.

Yet while the results demonstrated increased awareness and desire to do more when it comes to technological adoption, respondents revealed a number of obstacles that are blocking progress. When asked about their organisations’ concerns with paying part or all funding through a third-party fundraising platform, more than half of funders (54%) said they were worried about a lack of control over due diligence, and 41% voiced concerns of not being in control of grant communications with applicants.

A lack of technological know-how is often cited as the main barrier to the adoption of technology in the charity sector, but an equally common obstacle in our experience is a misplaced fear among many funders that technology will in some way replace the ‘human element’ in the application process, leading to a loss of overall control.

Funders resistant to change risk holding back a sector already under strain, with applicants in greater need than ever before facing mounting challenges when it comes to accessing the financial support they so greatly need. The established but reactive approach of requiring fundraisers to apply for grants one-at-a-time, and the subsequent allocation of grants to those that have the resources and time to submit applications tailored to each individual grant-maker’s criterion, can be transformed through technology. 

From a fundraiser’s perspective, having to apply for funding to each provider separately is extremely time-consuming; an average of 264 hours is spent applying for funding per year. This multiple application approach also leaves some organisations facing closure while others are over-funded.  Indeed, with one in five grant applications ineligible and only 30% of applications receiving some money, 100% of grant-giving organisations we surveyed agreed that a single, online, stage one grant application form would help improve processes and save time. 75% agreed that technology could enable better collaboration, and 92% confirmed that technology does not have to substitute the human interaction between grant-maker and applicant.

Technology can also support the automatic matching of charitable causes with multiple funders’ grant-giving criteria, enabling fast and effective selection, shortlisting and awarding of grants whilst at the same time allowing each funder to retain full control of their decision-making and fund management processes. In addition, fundraisers are then able to spend less time making grant applications and can focus more time on delivering their core services. Furthermore, technology introduces much-needed transparency into the process, enabling measurement of funding impact, for instance.

Ultimately, technology is here to stay and it has enormous potential to streamline processes, facilitate collaboration and – rather than replacing the human element in the grant-application process – actually free up more time for engaging with applicants and fellow funders, to achieve shared charitable giving goals.