Charities could increase donations by almost 50 per cent if the were more transparent about how money is spent, according to blockchain start-up Giftcoin.
A survey of over 2,000 consumers conducted by the firm found that by opening up, charities could increase donations and develop a closer relationship with their donors.
The research found consumers believe only around half of their donation actually goes to a charity’s states cause, with most believing that salaries and office rent absorb the remainder.
Findings also revealed that the UK is a “nation of charity givers” with 81 per cent of consumers donating to charity in the past 12 months. The average donation amounts to £67.
However, consumers believe that overheads are absorbing almost half of their donation. Many believe most of the money goes towards staff, office rent and advertising.
Given the option of more transparency from charities about where donations are spent, the average reported consumer increase in giving was 49 per cent, while one in six would double their donation or more.
Giftcoin co-founder Alex Howard said: “As the findings show, consumers believe that only half their donation actually goes to the cause they are giving towards. Salaries and office costs are absorbing too much. It is a disappointing situation that the charity sector must now address.
“It’s time that charities open up and become more transparent. Not only is it the right thing to do, the numbers also show that people will dig that bit deeper when they are confident the cause is maximising the use of every penny donated. At a time when everybody is tightening their belts, charities need to adapt to consumers’ desires to succeed.”