Oxfam and PayPal team up to launch new form of donation

Oxfam and PayPal have joined forces to launch 100% giving, a groundbreaking new partnership that sees PayPal paying for the running costs on every donation made to the charity in February via oxfam.org.uk/giving. This means that for the first time ever, a UK charity is offering a donation scheme through which 100% of every donation is guaranteed to go directly to the cause.

The initiative follows a new Oxfam report showing that people are often deterred from giving because part of their donation usually goes towards the charity's running costs. The 100% giving report reveals that 72 per cent of Britons believe running costs eat up a significant part of their donation, whilst 65 per cent admit they have been put off supporting charities because of these costs.

There is also a widespread misconception about the amount of money that is allocated to essential running costs, with most people believing it is more than three times the actual figure spent.

Dr Tom Farsides, a leading expert on why people give to charity, has investigated why the public thinks this way. His key findings reveal that concerns about their own financial welfare - in addition to an overriding belief that a large slice of their donation will not reach those who it is intended for - are the biggest barriers to giving.

Ordinarily, for every £1 donated to Oxfam, 81p goes directly to programme work to tackle poverty, while 19p is spent on essential running costs (for instance training our staff to work in the toughest conditions, getting vital equipment out to emergency situations). During February PayPal will cover these costs every time a donation is made via PayPal, meaning that each donation goes further and exclusively to the charity's lifesaving programme work.

It is hoped that the partnership will establish an entirely new model for donating to charities. For every £1 you donate, PayPal will cover all running costs when you donate via PayPal at oxfam.org.uk/giving. Any regular monthly donations set up during February will also have their running costs paid for the first twelve months.

Despite more than one in five (22 per cent) Britons saying that the recession has made them feel more compassionate towards those who are in greater need, almost half of those questioned (49 per cent) admit that the economic climate will mean they donate less to charity in 2011.

Cathy Ferrier, Oxfam's fundraising director, says: "Our running costs are absolutely essential to allow us to deliver hundreds of programmes in more than 70 countries worldwide. However, we appreciate that these costs can be a barrier for some people who are otherwise completely behind what Oxfam does. Thanks to our partnership with PayPal, we've achieved a first in removing this barrier to assure people that 100% of their donation will be going directly to helping the poor people we work with to have a brighter future.

"At a time when belts are being tightened, it's vital that charities are accountable. Whilst we are delighted with PayPal's offer to pay for our costs, we also want to assure people that we keep them to an absolute minimum and are committed to making every penny count."

Carl Scheible, PayPal UK's managing director comments: "We have huge respect for the important work that Oxfam does, and wanted to find a way to support both the charity and people looking to make their donations count in a tough economic climate. 100% giving is a quick and easy way to really make a difference: three clicks to help transform lives. It builds on PayPal's strong track record as a fast and convenient way to make donations to charity, including Children in Need and Comic Relief."

Report author, Dr Tom Farsides (University of Sussex), explains; "In challenging economic times people want charities to do everything within their power to provide front line services as effectively and efficiently as possible. Donors want to help, they don't want to feel like their money is being squandered."

All donations to 100% giving must be made via oxfam.org.uk/giving during February.