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Giving on the rise


A look at how GiveIndia, an online portal for charitable donations, received money in FY15. Plus, an analysis by Think Through Consulting, a financial advisory firm specializing in corporate social responsibility, on tax exemptions under the various sections and their relation to GDP growth

New Delhi: India’s largest online portal for charitable donations—GiveIndia, with over half a million registered donors—received 488,226 donations in FY15 from 100,413 donors.

Sandeep Aggarwal, chief executive officer (CEO) of GiveIndia, says, “With the obvious increase in giving by people, we are also seeing an increase in the frequency of giving. Earlier people would limit the giving to once a year or twice at the most—now, at regular intervals, they are putting in money for social causes."

However, income tax data for the last seven years, analysed by Think Through Consulting (TTC) Pvt. Ltd, gives a different picture. Vijay Ganapathy, global partner at TTC, says, “Overall analysis points towards a decrease in expenditure on donations to charitable trusts and institutions, whereas there has been an increase in GDP (gross domestic product) and gross tax revenue."

In 2008-09, India’s GDP was 56,30,063 crore and donations by companies and individuals, who applied for tax exemptions under section 80G of the Income Tax Act, was at 1,368 crore, which is 0.02% of GDP. In 2014-15, GDP has gone up to 1,25,41,208 crore, but the 80G deductions amounted to 1,940 crore, which is still 0.02% of GDP.

According to Ganapathy, “Even though corporate India is growing and creating value for shareholders, its commitment towards charitable purposes is decreasing."

But he adds that with the new corporate social responsibility (CSR) rule in play, the corporate share of philanthropic commitments, may see a rise in the coming years.

But this discrepancy can be explained in another way: “A number of people donate money in cash and a number of people do not even apply for the 80G tax exemption," says Meenakshi Batra, chief executive officer of Charity Aids Foundation (CAF) India, a not for profit which helps raise funds for small grassroots organizations. However, she agrees that certain types of activities, such as scientific research, attract more donations due to tax incentive.

Plus, as TTC data shows, individual giving has been on the rise.

An increase in planning for giving, participation of young people in philanthropy and a desire to see impact on the ground are the prominent takeaways from charity trends in India this year.

Akhil Bansal, deputy chief executive officer at consultancy firm KPMG India, says, “In my youth, philanthropy or giving was done by either retired people or those who had made all their money. But today, I see the younger
generation wanting to do a lot
more than just make money. They are keen to make a difference."

Contributions to Charity Aids Foundation (CAF) India, with 50,000 registered individual donors and 60 corporates, have grown from 20 crore in FY13 to 28 crore in FY14 and 40 crore in FY15.

“Apart from the overall increase in monitory contributions, we also see that people want to do a lot more than just sign cheques. A lot of people are seeking opportunities to give time and skills for social initiatives," says Batra of CAF India.

GiveIndia data also points to gender and geographical variations in giving.

Of the total number of donors in FY15, 66% were men and only 20% women, while the rest did not disclose their gender.

Among the top 10 giving states, Maharashtra accounts for 44% of the total donations by all the states, with Karnataka at 12% and Delhi at 10%.

According to Parul Soni, global managing partner at TTC, “There is a noticeable change in the overall outlook and mindset of the donors who want to focus more on long-term programmes with measurable output and impact. From a charitable approach to giving, the trend is now driven by impact. There is a new breed of investors that are working on a venture approach to philanthropy, leading to better results and impact."

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