Q3 Interest Rates

SMALL CHARITY INCOME BENT BY INCUMBENTS

Misguided loyalty towards exisiting suppliers is costing small charities dearly

Four in ten small charities are losing an average of £1,200 a year in savings because they lack the time required to seek cheaper alternatives to their incumbent suppliers such as insurers and energy companies.

 

This conclusion was drawn from an online health-check survey, conducted among 125 small charities by financial advice website, Back of the Sofa. Three quarters of respondents are registered with the Charity Commission or the Office of Scottish Charity Regulator and included: churches, village halls, Scout Groups and community centres.

 

The survey reveals how inertia to switch suppliers has led directly to respondents suffering financially. Findings include:

 

  • 40% are paying uncompetitive rates of 14p-25p per unit for electricity.
  • 43% receive no more than 0.1% interest on their cash reserves.
  • 75% have allowed their insurance to automatically renew without shopping around.
  • 93% have yet to switch water supplier, despite having been able to for over a year.


Other findings point towards a lack of time to deal with financial tasks:

 

  • 35% receive no Discretionary Business Rate Relief.
  • 42% have yet to register for Gift Aid.
  • 44% with regular donations under £20 fail to use the Gift Aid Small Donations Scheme.
  • 69% are not using HMRC Charities Online.

 

Nick Heath, founder of Back of the Sofa, commented: “Small charities are often held back because they lack the resource to make informed money-related decisions. The time and effort perceived to research non-essential alternatives leads to a ‘better the devil you know’ attitude and misguided loyalty towards existing suppliers. Fortunately for those involved in the finances of charities, there are short-cuts that can be taken to tackle this and platforms, like ours, to signpost them.”  

 

Back of the Sofa will be at Small Charity Week 2018 as an advisor on Big Advice Day (19th June). For more information visit http://smallcharityweek.com/big-advice-day/.

 

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Further information: Nick Heath 07720 297972 / nick@backofthesofa.com


About Back of the Sofa

Back of the Sofa was launched in October 2017 as a way to help charities do more good by boosting their income in innovative ways, without having to ask for more donations. As a free resource it offers the ideas, tools and help needed to find cash they’re literally sitting on - in the form of discounts on utilities and rebates on overpayments such as VAT on energy, water bills and Business Rates. It also offers fundraising ideas that rely on the buying power, rather than the generosity, of local communities. For example, a collective energy switch for a charity’s supporters (to save them money too) will automatically donate the commission that would otherwise be earnt by a price comparison website.

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