Is it secure to make donations on crowdfunding websites?

 Is it secure to make donations on crowdfunding websites?

By spreading the word on social media, crowdfunding platforms like Ketto, ImpactGuru, and Milaap assist those in need in raising money for a variety of causes. To determine the veracity of your claim, they will conduct a background investigation and request supporting documentation.

By allowing anybody to donate, no matter how modest, with only a few clicks, crowdfunding platforms have democratized generosity.

You frequently encounter heartbreaking photographs together with requests for donations for medical procedures when you explore the internet. Many will cause conflicting emotions. There will be compassion for the individual in need, but there will also be skepticism regarding the request's sincerity.

That is modern fundraising, or more specifically, crowdfunding, in action. Thanks to websites like Ketto, ImpactGuru, and Milaap, among others, persons in need of financial assistance can now reach a larger audience.

These platforms produce a "campaign," or an appeal that conveys the tale of those in need of funding and is backed by supporting documentation. In order to spread the campaign and raise money, it is then posted on social media and shared with the person's social network. The campaign is over once the needed funds have been collected.

These websites have democratized generosity by making it possible for anybody to donate, no matter how small, in just a few simple clicks. Your donation might also qualify for a tax deduction under Section 80G of the Income-Tax Act (if this is the case, it will be indicated in the fundraiser). However, given how simple it is, questions about the sincerity of many of these fundraisers have been raised.

We got in touch with a few people to learn about their experiences using these crowdfunding services, both those who donated money and those who raised money. Did those in need manage to raise the necessary funds?

Help at hand: a mixed bag of a situation

In December 2019, Arunima Lahiri, a public relations expert, approached Milaap about helping to gather money for her younger sister, who had been identified as having brain TB.

She claims that Milaap answered her request extremely quickly. "They built a campaign for us and requested photos and documents from us. They requested that we spread the word about it on social media and refused to do so themselves since doing so would give them more credibility. With the help of our friends who donated on the site, we were able to gather Rs. 45,000 (minus Rs. 5,000 for Milaap's costs), says Lahiri.

Not only that, though. According to Lahiri, the campaign gained traction among her family's social circles, and "members of the extended family, including my sister's in-laws and close friends, contributed Rs 12 lakh." Without the campaign, none of this would have taken place, she claims. Brain TB claimed the life of her sister in February 2020.

A very great experience was had by Mira (name changed upon request), who also used Ketto to raise money for her husband's surgery. "The Ketto salesperson communicated with us frequently. Within 48 hours, we were able to raise money. Both in India and overseas, our friends and relatives were eager to assist us. Nevertheless, we got in touch with Ketto since it made it simple for everyone, even those who lived abroad, to send us money. Additionally, we received donations from strangers.

Another individual, who wished to remain unnamed, spoke about his less than ideal experience raising money for his aunt's medical care. "A few years ago, we contacted ImpactGuru in the hopes that they would aid us in obtaining funding from their network of contributors. But that didn't take place. Simply sharing the campaign link with our acquaintances who gave to us is all they wanted, this person remarked.

On numerous social media sites, they amplify the campaigns, according to Piyush Jain, Co-Founder and CEO of ImpactGuru. "Given the vast number of fundraisers, it is not possible to advertise every single campaign. However, we make an effort to profile individuals who we think will be most popular with our donor group.

Three charge structures are available from ImpactGuru (graphic). Every medical crowdfunding site in the world charges a small fee to cover operating costs. We have to pay for things like employees, outreach for fundraisers, infrastructure for technology, due diligence and vetting, etc. Our purpose can only be accomplished if we are able to sustain ourselves, claims Jain. With Ketto, you can DIY-create a fundraiser with no platform costs. The starting price for premium services (mostly assistance with content and marketing) is Rs 4,999.

The decision to believe or not

Those who might be inclined to donate money for a worthwhile cause are seated on the opposite side. Numerous contributors who frequently used conventional channels to donate money to charity causes are among them. However, many people choose to proceed cautiously given that internet platforms put appeals right into their living rooms, the middle of a YouTube movie they are watching, or a reel on Instagram.

Consider Lakshmi Iyer, CEO of Kotak Alternate Asset Managers' investment and strategy division. On Ketto, she has contributed to more than a dozen charities. "I only give to those who have been referred to me; I never give to total strangers. On this, I'm pretty clear. There are plenty of con artists searching for free money, she claims.

The active Rotarian and joint managing director of Sansera Engineering, F R Singhvi, who has also donated to a few charities on Milaap, voiced some skepticism. "The majority of the reasons (contribution requests) are connected to medicine. I've occasionally thought the prices being offered were absurdly high. I can obtain estimates for these treatment expenses because I am connected to a hospital. He recalls one such petition asking for between 18 and 24 lakh rupees for the treatment of a spine injury. However, the institution with which I am affiliated may perform procedures involving the spine for about Rs 5–6 lakh.

The experience of their in-house panel of doctors, current TPA (third party administrators) rates, historical data on their platform, and those rates, according to ImpactGuru's Jain, are all taken into consideration when thoroughly examining hospital cost projections.

To choose the best health plan, see also Moneycontrol-SecureNow Health Insurance Ratings.

After his friend started a fundraising campaign on Ketto for the treatment of his father, Kapil Sharma, Senior Manager, Marketing and Brand Communications, Waterfield Advisors, lost his reluctance to donate on these platforms. Mira experienced the same thing once she was successful in raising funds for her husband's surgery.

The patient's medical records, hospital bills, and even letters from the hospital attesting to the patient's incapacity to pay the medical bill are included with the requests for donations, according to Sharma, who regularly contributes to crowdfunding platforms. "All of this documentation contributes to increasing confidence in the patient's legitimacy."

Jain answers, "Typically, more than 80% of the funds raised on ImpactGuru are directly transferred to hospitals," when asked how they make sure the money isn't wasted.The majority of these institutions have already been granted empanelled status by India's top health insurance providers. On the platform, all reimbursements are carefully processed against legitimate invoices. In order to eliminate any chance of fraud, Ketto claims that for the majority of medical cases published on their platform, the monies earned can only be withdrawn from the hospital's bank account in relation to the bills shared by the patient.

checking for sincerity

What criteria do these platforms use to determine whether a fundraiser is legitimate?

According to Jain, the ImpactGuru internal team employs a five-step verification procedure to guarantee the legitimacy of the fundraising efforts. (See graph.

People with whom we spoke confirmed this. Mira claims that she gave Ketto copies of her husband's scanned medical records and hospital bills, and that Ketto subsequently double-checked the information with the relevant hospital. Lahiri also mentioned doing this. She also notes that Milaap asked her for money to help with Mila's sister's home care arrangements. Milaap did not take this further though since the home-care organization was unable to produce an estimate of costs to back up her claim.

'Spam' calls, messages, and emails potential

Finally, be prepared to get calls, WhatsApp messages, and emails from them after you donate or raise money on one of these platforms. These could be updates on the status of a specific cause you had donated to, or they could be requests for donations for other campaigns. Some people may find the first bothersome.

Iyer claims that receiving constant emails and WhatsApp messages is a major disadvantage of such platforms. Although you can stop them, it is annoying. Sharma is also irritated by Ketto's constant barrage of emails, WhatsApp messages, and Twitter and Instagram advertisements. When questioned about it, Jain responded, "The vast majority of donors want to help several other people, and they want information on other projects. They vary in their preference for calls, emails, and WhatsApp messaging. In each of these situations, clients have the choice to opt out or request that we not call them.

Aside from that, how secure are these platforms in terms of the internet? Are payments made on them secure? Ketto and ImpactGuru's payment methods appear secure, according to Dr. Rajendra B. Patil, principal of Bunts Sangha's Anna Leela College of Commerce and Economics in Mumbai and a specialist in AI and cyber security.

"SSL encryption is used by ImpactGuru and Ketto to secure data transmission between users and their servers. This guarantees that all sent data is encrypted and safe from unauthorized access, the expert stated.

The pop-ups are a separate issue, though. Farrokh Jijina, a chartered accountant in Mumbai, considers crowdsourcing donation efforts "too gruesome." Many potential donors, like Jijina, find it disturbing to view images of mutilated bodies and disfigured faces that are featured in certain pleas. "Also, their commercials or appeals appear unexpectedly while I am watching something on the internet. They continue to appear even after you report them for repetition. Additionally, as I already mentioned, their advertisements lack all nuance.

He oversees the review of applications from those looking to generate money for medical expenses and poverty alleviation as a member of the boards of trustees for three distinct trusts. Jijina favors donating to charities that he knows personally over crowdsourcing websites when acting in his personal capacity.

Others, however, like public relations specialist Edil Corneille, joke that they are less impacted by calls and messages from these platforms because they are constantly on the phone with people. They frequently message me on WhatsApp and even call me. However, I don't report or block them since I believe they are doing it for a good cause and doing so would be counterproductive.

Finally, pointing out a benefit, Sharma of Waterfield Advisors claims that what he appreciates most about these platforms is that if you donate, you will receive an email informing you of the recipient's situation. It demonstrates your accomplishments.