The COVID-19 pandemic has pushed India Inc as well as the average Indian to loosen their purse strings towards philanthropy. According to a recent India Philanthropy Report by Dasra and Bain Capital, corporate social responsibility (CSR), driven by the 2% mandate, has grown at 15% annually in the past 7 years, with its share in total private giving growing from approximately 12% in FY15 to 23% in FY21. “Riding on rapid economic growth, formalisation, and more companies coming under its umbrella, CSR contributions are expected to grow at 19% annually, with its share expected to reach about 32% of total private giving by FY26,” says the report.
Philanthropic donation platform, GiveIndia, in the COVID-19 era has witnessed over two-thirds of its donations coming from institutions such as corporates and foundations. According to Atul Satija, CEO, GiveIndia, “Last year, we donated ₹1,225 crore. In the past few years, it has grown from ₹29 crore to ₹1,225 crore and a large part of this because of COVID. It has ignited a large amount of consciousness as institutions have allocated more money to us for giving.”
Satija says the pandemic for the first time has made non-profit a mainstream topic in India and it has a lot to do with the proliferation of digital payment methods. “With the payment system maturing today, people donate willingly ₹50-₹75 online without batting an eyelid. Giving is discretionary, if it is not convenient or easily available to me, I may not donate. COVID-19 brought in a higher level of trust in giving, because people saw it first-hand,” he explains.
While the HNIs (high net worth individuals) and UHNIs (ultra high networth individuals) are people with an annual income of over Rs 300 crore, Satija, in his personal capacity, is also associated with the ‘Living My Promise’, which enables people with an income of Rs 1 crore and above to contribute to charity. Satija claims they already have over 100 promisers as part of that group.
Satija is also associated with the ‘Young India Philanthropy Pledge’ as and advisor. The initiative encourages people with over ₹1,000 crore net worth to pledge their income towards charity. “We have people like Zerodha founders (Nikhil and Nitin Kamat) and Udaan founder Sujeet Gupta as part of this initiative. Most of them start with pledging ₹2-5 crore,” says Satija. Though the Indian philanthropy ecosystem is seeing the entry of a host of new-age givers, Satija says they are taking baby steps as they are new to the world of giving.
The Dasra-Bain Capital report confirms this trend. The total social sector expenditure in India has seen a robust 12% annual growth from approximately ₹10 lakh crore to about ₹17.5 lakh crore over the past five years. In fact, FY21 witnessed a sharp increase, with a 20% jump in total expenditure. However, most of this rise has been a result of increased government expenditure. In fact, UHNI giving has decreased from the peak of 2016, while HNI giving has grown at a modest pace. Relative contributions (giving as a percentage of wealth) among Indian UHNIs range from 0.1% to 0.15% compared with 1.2% to 2.5% in the United States, 0.5% to 1.8% in the UK, and 0.5% to 1.4% in China. However, with new-age investors entering the fray, family philanthropy is expected to grow at 13% per year until FY26.
