Everything That Crowdfunding is NOT: Say Goodbye to 5 Common Fundraising Misconceptions
By: Milton, Visakha
Published On: November 12, 2021
Considered relatively new for people in India, online crowdfunding is now being largely recognised as a viable way of getting financial support during medical emergencies. When faced with an unforeseen diagnosis people usually have to delay their treatment altogether or in the case of a chronic illness, have to abandon their treatment midway due to its unaffordability.
We, at ImpactGuru, aim to make healthcare affordable and accessible for everyone through crowdfunding. Generous donors donate funds on our crowdfunding platform to help patients get their treatment on time by paying off their medical bills. If you’re not familiar with the concept, here is how crowdfunding works in India.
As with every new concept that is introduced in the market, apprehensions and scepticism are quite common. Although at some point, these doubts turn into a barrier that can stop you from engaging in something that may be beneficial to you. At ImpactGuru, we’ve come across queries such as “Is crowdfunding genuine?” or “Is crowdfunding legit?”
Today, we help you clear some of the most common misconceptions about crowdfunding so that you can know more about this way of getting and giving financial support and use it to your advantage!
Misconception 1: Crowdfunding is unsafe and illegal
The myth that crowdfunding isn’t legalised and that you can risk losing your money is totally misleading. To set the record straight, crowdfunding is completely safe and legal in India. It is governed by SEBI (Securities and Exchange Board of India) in India. They have classified crowdfunding into 5 types:
Donation crowdfunding - wherein no payback is expected in return of donations received
Pre-order crowdfunding - for obtaining a product in the future in return of funds raised
Reward crowdfunding - wherein a non-financial reward is expected in return of donations received
Debt Crowdfunding - similar to applying to a bank for a business loan
Equity Crowdfunding - allows the general public to purchase shares in an existing business or a startup
Note: Except equity crowdfunding, ALL types of crowdfunding are legal and safe. Equity crowdfunding has not been legalized in India yet.
Misconception 2: Crowdfunding is completely free!
No, crowdfunding is not completely free on most crowdfunding platforms. On a donation-based fundraising platform such as ImpactGuru, no platform fees are charged while starting a fundraiser. To help us to provide you a free fundraising option, we ask donors for a voluntary tip while donating. However, all payments on the fundraiser are subject to a payment processing fee.
The payment processing fee covers multiple costs associated with processing your transaction seamlessly and securely on Impact Guru. Other costs incurred by Impact Guru to process these transactions include fees paid to third party services for fraud prevention and management to ensure the platform is completely secure for our donors, costs incurred for auto-calling and manual follow-ups for failed and abandoned transactions and other similar services.
Note: To make sure you retain the majority of the funds you raise, ImpactGuru has introduced a unique 0% fee model. You can know more about it here: 0% Fee Crowdfunding
Misconception 3: Crowdfunding is the quickest way to raise money
The old adage by John Heywood, “Rome wasn’t built in a day” - is quite apt for the above misconception. Successful fundraising might take days, month or even longer. Quite a substantial amount of fundraisers on ImpactGuru have reached the goal amount within hours too.
Baby Dhairya’s fundraiser raised a whopping Rs.16 crores for a rare disease treatment.
We cannot stress this enough, no two fundraisers are the same.
Set a goal. Make a plan and be patient. If, at any point you need additional support while fundraising, get in touch with our relationship manager on [email protected] or 1-800-102-0380
Misconception 4: Uncertainty about where the money goes if a patient passes away
At times, the patient may not survive due to the critical and unpredictable nature of their disease. In circumstances like these, updates on the fundraiser regarding the same are put up so that the donors remain in the loop no matter what.
The medical bills, financial debt consequent of the healthcare given so far as well as other emergency expenses still remain. Here, the donations help the family deal with the loss emotionally by supporting them financially at an extremely vulnerable point of their lives. In some cases, the bereaved family may choose to donate the amount to other medical fundraisers.
No matter what, verified crowdfunding platforms make sure that the funds raised are shared with the consent of all the parties concerned.
Misconception 5: A campaigner is penalised for not meeting the goal amount
No, there is no penalty. In fact, medical fundraising donation websites like ImpactGuru, allow withdrawal of funds in the middle of your fundraising journey. We follow a flexible model with accessibility to all, where you can keep what you’ve raised without being penalised for not meeting your goal!
We hope that this has helped solve some of your misconceptions about crowdfunding. At this point, if you need to raise funds for your medical bills or your loved one, start a free fundraiser with ImpactGuru today to pay off your medical bills on time!
If you have any other questions, reach out to us via email on [email protected] or give us a call at 1-800-102-0380. We would love to hear from you!