Experts predict the financial crisis triggered by Coronavirus to have an enormous impact on world economies. Since no one can be certain how long the virus will impact global businesses, predicting the recession’s scope is impossible, but experts agree that it will be steep and unprecedented. Not-For-Profits (NFPs) have not been spared and we can even say that they have been badly hit in terms of financial support reduction and resource allocation. The not-for-profit sector can assume that their fundraising will be more challenging during the financial crisis. During the 2008/2009 recession, giving in the UK fell by 11% overall, according to the Charities Aid Foundation. About half of the charities the Foundation interviewed in Q2 of 2020 had already begun to seek out emergency funding to survive the crisis.
Government aid is available
Governments around the world are responding to the crisis in different ways. Many have earmarked funds for the nonprofit sector, and some have established new rules to enable not-for-profits (NFPs) to raise funds directly from the public as well. For example, the UK has pledged £750 million to voluntary, community, and social enterprise organisations to continue their work during the coronavirus outbreak. Much of this support is earmarked for coronavirus health responders, but there are funds available to other sectors as well. Russia has declared a tax holiday for NGOs providing social services. Canada and the United States are both offering low-interest loan programs and lending guarantees to not-for-profits and social enterprises. Both nations also have support available at the state or provincial level.
Other funding sources
The civil society — private enterprises and private as well as institutional donors — have been in the front line to help NFPs meet their challenges during these hard times. In Egypt, for instance, government hospitals appealed to the private sector for Ramadan donations to alleviate some of the expense of COVID treatment. The general public seems to feel a strong desire to give at this time, and donors who haven’t lost income due to the virus are willing to support causes that can show a need. This is especially true if an organisation can demonstrate a need that is related to COVID-19. In a recent survey, 57% of respondents agreed or strongly agreed that charities should engage in fundraising during the crisis, so NFPs shouldn’t hesitate to ask donors for funding at this time.Click here to learn more.