smartphones have made us more generous

More people are making charitable donations on their mobile devices

 

There may be some upside to our smartphone addictions.
Charitable giving has hit record highs in recent years, with Americans giving more than $358 billion in 2014, a 7% increase from 2013, according to National Philanthropic Trust, a public charity that supports donors, foundations and financial institutions, and the numbers for 2015 are on track to be even higher.
As more people shop using mobile devices, more Americans are also making charitable donations on their smartphones and tablets.

Mobile technology has made donating easier. Some 20% of donations through PayPal were made on mobile devices during this holiday season, compared to about 13% during all of 2014, the company said. In August, Facebook introduced a “Donate Now” button for nonprofits.

People donated nearly $40 million on Giving Tuesday this year, compared to $26.1 million in 2014, through Blackbaud, a company that provides software and services to about 35,000 nonprofits worldwide. Of those donations, 17% were made on mobile devices, compared to 13% in 2014.
Mobile donations are convenient and produce immediate receipts for tax deduction purposes. “Mobile is no longer optional,” said Steve MacLaughlin, the director of analytics at Blackbaud. “Consumers are driving that behavior, whether non-profits are ready or not.”
Several companies and new apps are making it easier to donate on your mobile device. “It’s incredibly important for non-profits to adopt a mobile strategy,” said Sean Milliken, PayPal’s head of global social innovation. “It’s essential to fundraising success going forward.”

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PayPal PYPL, -1.98%   donates 100% of donations made through PayPal’s Giving Fund, a division of the payment company that is registered as an independent nonprofit, (plus an additional 1% donation from PayPal until Dec. 31).
However, this type of mobile service isn’t always free for charities. PayPal donations made outside of the Giving Fund are charged 2.2%, plus 30 cents in the U.S. for each transaction, still less than the 2.9% plus 30-cent charge for merchants, Milliken said. UBack, an app that allows users to donate to a variety of non-profits, keeps 1% of every donation in addition to the 2.9% fee Bank of America charges to process the transaction.
Although mobile giving is gaining popularity, there are several obstacles that experts say are still holding consumers back, potentially leaving millions of dollars on the table:
1. Apple does not allow consumers to make donations within its apps.
Apple’s AAPL, +0.05%   app store can facilitate donations to recognized charitable organizations, as long as they are free to download, according to Apple’s guidelines. https://developer.apple.com/app-store/review/guidelines/ And the donation itself must be made on a website in Safari or sent through SMS, meaning the transaction can’t be completed within the app. This frees Apple from having to regulate what charities and apps are legitimate or not, experts say. (Apple did not respond to a request for comment on its in-app donation policy.)
App developers have created methods of redirecting donors to Safari web pages that look as if they are still part of the app. But the inconvenience is significant, they said. “Every second really does matter,” said Kaitlin Reimann, the CEO of uBack. “We’d like to be able to reduce friction.”
Being redirected to a Safari page is “not ideal,” said David DeParolesa, the head of product for Small Token, an app that allows donors to make a contribution to a non-profit as a gift for someone else, without taking a fee in addition to credit-card transaction fees. “We would love to be able to do donations within the app.”There’s a lot of money at stake: Some 44% of mobile donations are being made on iPhones, according to Blackbaud.
Google’s GOOG, +1.37%   Android platform does allow charitable donations within apps through its Google for Nonprofits program, but also has fairly strict guidelines, including prohibiting government entities or organizations, hospitals and health-care organizations, schools, childcare centers, academic institutions and universities. Google did not respond to a request for comment on its policy.
2. Online giving may not appeal to the wealthiest donors.
Mobile donations have been praised for being easy to use and convenient, but when it comes to more significant donors, that low time commitment might actually be an obstacle, said Nick Tedesco, the West Coast lead of JPMorgan’s JPM, +1.35%   Philanthropy Centre and a former relationship manager for the Bill & Melinda Gates Foundation. “I think there is still a threshold of giving that is not conducive to online giving,” he said.
Many donors want to interact with the organizations they support, Tedesco said, and to have a conversation about the possible impact of their gift. They also want to do due diligence with the recipient organization to be sure of its authenticity and avoid online scams. For example, mobile giving was in the spotlight after the January 2010 earthquake in Haiti, leading to an estimated $43 million donated to assistance and reconstruction efforts via SMS. But only 21% of those who texted donations to Haiti did any research into the cause beforehand.
Still, Blackbaud’s MacLaughlin said 90% of nonprofits receive at least one online donation of $1,000 or more each year, with online donations totaling tens of thousands of dollars each, and one even reaching $200,000 this year. And adults over the age of 55 are actually more comfortable making payments by debit and credit card than younger adults are, according to the Federal Reserve.
3. Many organizations have no mobile strategy.
Despite the importance of mobile, a portion of non-profits still do most or all of their campaigning by mail, said Elizabeth Ngonzi, an adjunct faculty member at New York University’s Heyman Center for Philanthropy and Fundraising, who teaches a course called “Donor Engagement: Online and Mobile Tools.” Many don’t even have mobile-responsive websites that allow users to access a website on a mobile device easily, which means they may be trying to read tiny type on their screens or attempting to enter credit-card information into very small boxes, she said.
“Single-channel communication is dead,” MacLaughlin said. Contacting potential donors in multiple ways, in some combination of mailing, online ads, phone calls, social media and email, is most effective, he added.
Some organizations even have their own apps that allow donors to give, although building an app can be expensive and time-consuming. The United Nations’ World Food Programme debuted its app, ShareTheMeal, on Nov. 12, allowing smartphone users to donate meals to Syrian refugee children in Jordan. Since its launch, more than 330,000 people have downloaded the app and donated enough funds to provide about 3.3 million meals. “We just find that so many young people are so much more comfortable doing transactions of all sorts, including financial transactions, on handheld devices than on desktop devices,” said Steve Taravella, a communications officer for the World Food Programme.