Understanding the Impact of COVID-19 on Charitable Organisations

by Givey Team

27 October 2021

To say that the COVID-19 pandemic has turned lives upside down is an understatement — this is especially true for institutions and organisations relying on monetary support. The Guardian estimates a £6.4 billion loss of income over the course of six months for the UK’s 170,000 charities, leaving one in ten potentially facing bankruptcy. With that said, donors’ tightening purses is not the only consequence of the pandemic and in this article, we’re diving into the many struggles the pandemic inflicted on UK charities.

Decline in donations

Reuters assessed that more than 40% of Britons struggled financially in 2020. That’s approximately 27.7 million adults living from paycheque to paycheque. Because of the economic slump, those who were originally actively participating in charity work had to hold back, for the sake of their personal financial needs. This heavily impacted the charitable sector, and most are still in the process of recovering from their slump.

The result of this was a significant decline in donations, and organisations found it difficult to secure sources of funding, especially as the crisis dragged on. Moreover, FXCM highlights that the UK was not exempt from the global recession that followed after the market meltdown in March 2020. Massive sell-offs in global equities ensued, and even trade on Wall Street was temporarily halted for the first time since 1997. Even sources of monetary support outside the UK were hard to procure, as the rest of the world struggled to fend for themselves.

Services rendered more difficult

Although there was a huge decline in finances, there was a surge in volunteering. Despite this, COVID-19 hindered services and mobilisations. Social distancing methods and constant testing added to the challenges charities and volunteers had to face, alongside the risk of contracting the virus themselves. Organisations had to carry out projects in a COVID-19-compliant manner, while smaller groups couldn’t even reach their beneficiaries. For instance, the charity Prison Reform Trust recounted how they struggled to provide their services and family time to inmates due to high infection rates and strict restrictions.

Structures stripped and simplified

Organisational efforts were stripped to the bare minimum — work practices were simplified, attending staff reduced to the skeletal structures, and many major promotional and fundraising events were unfortunately canceled or postponed. Staff and volunteers that were retained are overworked and constantly under stress. Only 51% of charities were able to say that they were successful at adapting to the new normal, and 42% are worried about the reduced services that they offered. Additionally, many struggled with transitioning into becoming more digital-centred or finding an online platform like Givey. Looking for an online donations platform is crucial, as it uses the opportunity of mobile and social avenues to reach new audiences.

Lack of government help

With all of these challenges, and without urgent and targeted interventions, grassroots charities risked being wiped out altogether. And while the government attempted to provide aid, many were still asking for increased funding and support. There were appeals for the government to review existing COVID-19 policies and how they applied to charities, such as the rules for volunteering and granting special status for non-profit shops for reopening. Organisers also called for the government to draw awareness to smaller charities and encourage public generosity, as well as to provide investment in the hardest-hit charitable sectors — those in the field of health providers and medical research, for instance.

Charities have long played important parts in helping those most in need in society, but when it is the organisations themselves that are struggling, it’s hard to find ways for relief. In our infographic on the Forgotten 95% we outlined how smaller charities make up 95% of the sector, yet 90% of donations go to larger charities. We seek to even out this ratio and grow smaller charities’ supporter base by raising awareness in the digital field.

Article written by Renae Jenkins
Exclusively for Givey

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