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Payroll giving : an easier way to donate

Payroll giving : an easier way to donate
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First Published: Tue, Feb 06 2007. 12 00 AM IST
Updated: Mon, Feb 05 2007. 12 38 AM IST
MUMBAI: For years, Anupam Garg, an engineering manager withAdobe Systems in Noida, donated to charities from children’s rights advocates to elder-care groups. Yet, the goodwill often stressed him out.
“It takes a lot of running around,” he said. “You have to first collect the forms, then fill up the details before submitting them yourself.”
So a year ago, when Adobe began a payroll giving programme—allowing donations to NGOs of his choice to be automatically deducted from his pay cheque—Garg immediately signed up. At Adobe, Garg joined about 90 of the software company’s 900 employees who contribute Rs30,000 monthly to Charities Aid Foundation, the liaison that then doles the money out to other non-governmental organizations. In return, Garg receives a tax break and regular online report detailing how his money is being spent.
Payroll giving represents just a fraction of the Rs3,000 crore per year donated by Corporate India, according to Voluntary Action Network India, an umbrella organization of 2,000 NGOs. But companies and NGOs estimate the practice is growing between 30% and 50% annually, while creating more transparency in the vast NGO sector.
“There is a significant interest among corporate donors and NGOs are focusing to leverage this,” said Shibani Sachdeva, executive director of the United Way, one of three large intermediary NGOs operating in the country. “It’s the start of a new movement,” she added. United Way, a US-based nonprofit that is opening branches across India, serves as a network of community and non-governmental organizations. For decades, many companies in the United States have offered contributions to nonprofits such as the United Way.
In 2002, United Way’s India arm attempted a payroll programme in Mumbai, with a Rs50 lakh grant from the Ford Foundation. The first year saw “zero clients”, Sachdeva said. And then the 2004 tsunami struck, killing more than 2,00,000 people. Within hours, Sachdeva received half a dozen calls from companies wanting to enroll. Two days later, she had Rs25 lakh from workers across the country who parted with a day’s wages.
“The tsunami, in a sense, forced corporate houses to build in a process to harness an employee’s concern towards community development,” said Sachdeva.
Now India’s United Way has about 45 corporate partners with more than 4,000 individuals enrolled in payroll giving programmes. Last year, less than Rs1 crore of its total income of Rs6 crore came through payroll giving, distributed to some 46 NGOs.
Besides Charities Aid Foundation and the United Way, the third-large NGO that channels funds between the companies and NGOs is Mumbai-based Giveindia. Set up by N. Venkat Krishnan, an Indian Institute of Management, Ahmedabad, graduate, Giveindia coordinates programmes for 8,000 donors across 30 companies and collects Rs20 lakh per month from employees at companies such as HDFC Mutual Funds and HSBC and ICICI Bank.
“To donate about 100 bucks a month is no big deal for a white-collar employee. But in a year, he is accumulatively donating Rs1,200,” says Mathan Varkey, marketing head of Giveindia. “The beauty is that you are able to donate without feeling the pinch.”
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First Published: Tue, Feb 06 2007. 12 00 AM IST
More Topics: Money Matters | Personal Finance |