It's an adjective that is becoming as overused as 'disruptive', but Open Banking payments are genuinely transformative, particularly for the UK third sector. Open Banking facilitates simple, secure direct bank transfers, bypassing traditional intermediaries such as debit and credit card networks. Fintechs like Wonderful who offer this service, must be authorised by the Financial Conduct Authority to do so, but this innovation offers many benefits for charities, especially when combined with platforms like the Wonderful Organisation, which leverages Open Banking to revolutionise how donations are processed.
Understanding Open Banking payments
Open Banking is a system where banks provide third-party fintechs access to consumer banking, transaction, and other financial data from banks and non-bank financial institutions through the use of application programming interfaces (APIs). For charities, this means a direct and secure way to receive donations from supporters' bank accounts to their own, without the need for credit or debit cards.
Benefits for UK charities
- Elimination of processing fees: Traditional donation methods, such as credit card transactions, often involve processing fees that can significantly reduce the actual amount received by charities. Open Banking payments eliminate these fees, ensuring that 100% of donations made via Wonderful goes directly to the charity.
- Instant fund transfers: The speed of transactions is crucial for charities, especially in times of emergency or crisis. Open Banking enables instant or near-instant transfers, allowing charities to access funds quickly and respond to needs more effectively.
- Enhanced security and compliance: Open Banking is built on secure, regulated frameworks that protect both the donor's and the charity's financial information. This security fosters trust and confidence among donors.
- Increased transparency and control: With direct transactions, charities have greater visibility and control over their finances. This transparency is beneficial for both financial management and for building trust with donors and stakeholders.
Maximising the potential of Open Banking for charities
The Wonderful Organisation is a prime example of how Open Banking can be leveraged to benefit charities. This online giving platform offers a suite of tools and features that not only facilitate donations but also enhance the overall experience for both charities and donors.
Key features of the Wonderful Organisation
- Zero processing fees: Aligning with the principles of Open Banking, the Wonderful Organisation ensures that charities receive the full amount of every donation, free from any processing fees. In fact, there are no fees whatsoever for UK charities using Wonderful (either via Wonderful.org or using our smartphone app or payments API).
- Instant donations: The platform uses Open Banking technology to enable immediate transfer of funds, providing charities with quick access to donations.
- Deployment of QR Codes: To simplify the donation process, Wonderful Organisation has integrated QR code technology into its online giving platform and smartphone app, One. This feature allows donors to quickly and easily make donations by scanning a code, streamlining the process and encouraging spontaneous giving.
- Encouraging outdoor activities: With spring approaching, the platform is focusing on promoting outdoor activities such as running, cycling, trekking, and walking. These sponsored events are not only great for fundraising but also foster health and wellbeing, community engagement and raise awareness for the charities involved.
The impact on fundraising and community engagement
The combination of Open Banking payments and the features offered by the Wonderful Organisation creates a powerful tool for charities. The ease of donating, coupled with the elimination of fees, encourages more people to contribute. Additionally, the focus on outdoor activities aligns with the growing interest in health and wellness, making fundraising more appealing and accessible to a broader audience.
A case for embracing financial technology and innovation in charitable giving
The Wonderful Organisation's use of Open Banking payments is a testament to the importance of embracing technology in the charitable sector. By leveraging these advancements, charities can not only improve their financial operations but also create more engaging and effective fundraising campaigns.
In conclusion, Open Banking payments represent a significant opportunity for UK charities to enhance their fundraising efforts, reduce costs, and build stronger relationships with their supporters. We are at the forefront of this change, providing innovative solutions that harness the potential of technology to make a real difference in the world of charity. So, as spring approaches, it's the perfect time for charities to explore these opportunities, engage their communities in fun outdoor activities, and maximise their impact.