The Challenges of AI in Small Charity Fundraising

by Lauren Armstrong

6 November 2023
The third sector unites individuals, organisations, and communities to support various causes. In particular, small charities rely heavily on fundraising to sustain their vital missions. Over the years, artificial intelligence (AI) has emerged as a force that promises greater efficiency and reach in small charity fundraising efforts. For example, we can use AI for relatively inconsequential purposes. This could be providing recommendations to online customers for what to buy, or creating content for an organisation’s social media page. 
However, AI can also be used in more meaningful ways – such as allowing health professionals to identify diseases. For charities in the UK, it can help with their fundraising goals. This article will look into the challenges that AI presents to small charities in the UK fundraising sector. It will discuss the complex relationship between technology and raising money for charity. 

Ethical Considerations of Using AI For Small Charity Fundraising

When fundraising for charity, an important aspect we should consider is ensuring that privacy and human rights are respected. Now that AI systems are becoming more prevalent, there are more factors to take into account. For example, ensure that your fundraising does not incorporate bias or discrimination against particular groups of people. 

While AI-driven fundraising campaigns can be highly effective, they run the risk of leaving certain segments of the population behind. There is a clear digital divide, including disparities in internet access, digital literacy, and technological resources. This is a common issue within raising funds as it can prevent small charities in the UK from reaching potential donors. Particularly in disadvantaged communities, it is challenging for charities to gain the full potential of AI in fundraising. AI may inadvertently exacerbate this divide as it often relies on online platforms, chatbots, and virtual assistants to engage donors. Small charities must ensure that they do not exclude the very people they aim to serve by adopting AI tools. The challenge is to utilize AI while remaining committed to inclusivity and accessibility.

Balancing Privacy and Personalisation

One hurdle that small charities face in integrating AI into their fundraising efforts revolves around data. AI thrives on information – the more data it has, the better it performs. However, with data collection and management come significant ethical concerns. Many charities, especially smaller ones, lack the resources and expertise to navigate the murky waters of data privacy and security.

Small charities must discover a balance between personalisation and respecting donors’ privacy. AI can assist in creating tailored fundraising campaigns by analysing donor data. Despite this, problems in data protection could tarnish the reputation of these organisations. Personal connections are of great importance for small charities, therefore a breach of trust can be devastating for them.

Although AI has been around for many years, there is little in the way of regulation of it. It has exploded in capabilities recently, but it does not seem that much is happening at the moment. The UK government has not yet introduced new laws to regulate AI. Moreover, the United States government is in a similar situation. At the moment both seem satisfied by controlling the use of artificial intelligence through existing privacy rules and other legislation. On the other hand, the EU has prepared an AI Act which may become law by the end of 2023. This concentrates on regulating the identifiable risks associated with the use of AI.

Despite the EU’s attempt to regulate AI, it’s unlikely that a consistent global regulatory framework will become apparent soon. There are still countless challenges that need to be overcome before that can happen.

This illustration depicts language models which generate text. It was created by Wes Cockx

The Complex World of AI-Powered Small Charity Fundraising

AI has been around for longer than most people realise, yet there are still constant advances in this technology. The pace of AI development – for now at least – is much greater than lawmakers’ ability to draw up regulations. That means that regulations may be out of date by the time they come into force. For all regulations being introduced, they must be flexible and adaptable in order to be useful. There is still a rapid pace of development in AI technologies, therefore improved regulation will likely be put into place when this slows.

Additionally, since AI technologies are evolving and improving quickly, there is a lack of government expertise. This makes it extremely difficult for regulators to keep up with the way they work, how they may be applied, and any potential risks. Without adequate knowledge of AI, the risk of drawing up regulations which are impractical becomes high. All regulation within this field should promote transparency to help build trust and ensure fairness in all areas of non-profit organisations. 

For the foreseeable future, this means AI will be untamed to an extent. As data privacy and various laws are in place, organisations will still be controlled on what they can do with AI. However, there is more time before the technology is fully moderated and stricter regulations begin to appear.


In the UK, charity fundraising is fast-evolving. Small charities face numerous challenges as they consider integrating artificial intelligence into their campaigns. There are several aspects which require thoughtful consideration. This includes: balancing data privacy with personalisation, addressing the digital divide, and maintaining a human touch in donor interactions.

While AI has the potential to revolutionize the fundraising sector by enhancing efficiency and reach, small charities must proceed with caution. They should invest in data security and privacy measures, ensuring that AI benefits do not come at the cost of donor trust. We must make an effort to bridge the digital divide by maintaining accessible and inclusive fundraising strategies. Ultimately, the successful integration of AI in small charity fundraising relies on a balanced approach. By embracing technology while preserving the core values of the non-profit sector, small charities can harness the power of AI to further their vital missions and create lasting change in their communities.

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