Fund raising, donation processing incur administrative costs

The National Volunteer and Philanthropy Centre (NVPC) encourages charities to be transparent in their fund-raising activities so that donors are aware of how their funds will be used ("Cashless donations should be made easier" by Mr Chia Chong Ming; May 19).

Fund-raising activities and donation processing incur administrative costs, which are usually internal administration as well as third-party costs imposed by banks and credit card companies.

Fees charged by banks and credit card companies to process charitable donations can vary.

Some banks waive their own fees and pass on only the credit card company charges.

NVPC's online giving platform - giving.sg - charges non-profit organisations a service fee of 1.5 per cent for all donations raised through the site. This fee is imposed by our electronic payment service provider. NVPC intends to work with its partners and other entities to reduce these fees.

A good example of how this can be done is the partnership between Capital One, Network for Good and GuideStar in the United States.

Donations made using a Capitol One credit card on the No Hassle Giving Site are not charged a fee.

Network for Good processes the donations and disburses funds to selected charities from GuideStar's database of registered charities.

Capital One credit card holders enrolled in the No Hassle Rewards programme can earn reward points for their donations.

In Singapore, several banks and other financial companies give back to the community strategically through their corporate social responsibility (CSR) and other philanthropic activities.

How about creating more goodwill?

Perhaps our banking and financial bodies could consider the example above and introduce or integrate fee waivers as part of their CSR initiatives.

This win-win approach will encourage more charities to utilise cashless giving options which could improve ease, transparency and even accountability for donors and charities.

Leah Holzworth (Ms)

Insights and Content Creation

National Volunteer and Philanthropy Centre

A version of this article appeared in the print edition of The Straits Times on May 28, 2016, with the headline 'Fund raising, donation processing incur administrative costs'. Print Edition | Subscribe