PLAIN FACTS

For India’s NGOs, it’s a

struggle to raise funds
BY TANAY SUKUMAR & NANDITA VENKATESAN

Just a handful of Indian nonprofits had incomes of over ₹100 crore in 2021-22. Foreign-origin NGOs are getting
a disproportionate share, while homegrown ones are struggling to scale up with uncertain funding sources.

Even at the top, NGOs have stark The top of the ladder is dominated
funding disparity by newer NGOs
Donation income in 2021-22, by entity's rank (₹ crore) Donation income received in 2021-22 (₹ crore), by year of registration
900 Donation
Rank 1 817.1
800
Rank 10 166.0 700
Each dot represents an NGO.
Rank 20 96.3 600
500
Rank 30 80.1 400
Rank 40 62.5 300
200
Rank 50 47.6 100
Rank 100 16.6 0
1940 1950 1960 1970 1980 1990 2000 2010 2020
The 2021-22 donation income was available only for 139 Year
Data on both the 2021-22 donation income and the year of registration were available only
of the 176 largest-budget NGOs covered in the analysis. for 125 of the 176 NGOs covered in the analysis.

Children-focused NGOs get Foreign NGOs have an outsized revenue share

maximum share of funding Share (%) of global-origin NGOs in: Number of global-origin
Share of donations received by top NGOs, Number of NGOs analysed NGOs in: (2021-22)
2019-20 to 2021-22, by sector (%) Total income Top 10 6/10
29.0
24.7 27.3 27.5 Top 25
Children
9/25
Community
development 22.8 Top 50 14/50
17.0 17.2
Education 15.2 14.6
Top 100
Healthcare 8.5 17/100

Sustainability 5.9

Livelihood 5.0 2019-20 2020-21 2021-22

The analysis covered 171 NGOs in 2019-20, 169 in 2020-21,
and 144 in 2021-22, for which the income data was The rankings are by 2021-22 total income, which
Giving 3.7 available. This includes non-donation income as well. was available for 144 NGOs in the analysis.

Social justice 1.8

Delhi-headquartered NGOs have the largest budget sizes
Share (%) of each state in combined total income of NGOs in the analysis, 2021-22

Women 1.6 Maharashtra Gujarat Tamil West

Telangana Nadu Bengal

Disability 1.6 Delhi Karnataka 16.3 11.5 6.7 6.4 1.9

35.3 18.3
Others 7.0 The state names correspond to the headquarters of NGOs.
The data pertains to 142 organizations with available data.
The analysis covered data from annual reports of India’s highest-budget independent nonprofits having their own mission statements and
funded by multiple types of funders. This excludes corporate CSR wings, donor agencies, multilateral bodies, educational institutions and
hospitals, and global nonprofits that do not report data on their India units separately. However, the list was subject to availability of data,
and may exclude large entities whose data was not reliably available. While the overall pool had 176 entities, only 138 had income data
available in all three years. Source: Data compiled and analysed by Sattva Consulting; additional analysis by Mint
PARAS JAIN/MINT

L
ater this month, SGBS Unnati Foundation, a
Bengaluru-based nonprofit, is set to become the first
to list on India’s newly minted National Stock
Exchange-backed Social Stock Exchange. The platform
aims to provide India’s nonprofits an opportunity to raise
funds on a recognized platform. While many of India’s
nonprofits engage in critical development activities, their
financial health doesn’t always inspire much confidence as
raising funds remains a big challenge.
Just 19 nonprofits earned over ₹100 crore in 2021-22,
showed an analysis of annual reports by impact consulting
firm Sattva Consulting. Contrast this with the corporate
social responsibility (CSR) spending of India’s largest
companies: 34 exceeded a budget of ₹100 crore in the
same year, and the combined incomes of the top 100
NGOs was 30% less than the combined CSR budget of the
top 100 spenders.
The study, whose data was exclusively shared with Mint,
analysed the incomes of 176 of the largest non-
governmental organizations (NGOs) in
India in 2019-20, 2020-21 and 2021-22. Overall, NGOs were Among
The 138 entities that reported data in all
three years earned a combined ₹22,274 left with an income “In the digital era, being able to showcase
crore in income in this period, but as surplus of around work and build a brand presence online,
much as 59% of this went to just the top
quintile (20%) of the set. The annual 5% after making
donation incomes ranged from ₹4.4 lakh their spending
to ₹817 crore in 2021-22: note that this is
already a very tiny elite set out of India’s
estimated 3 million nonprofits. Overall, NGOs were left
with a surplus of just around 5% of their incomes after
making their spending.
While 85% of the entities in the full set in 2021-22 were
India-headquartered, their share in funding was only 72%.
Global NGOs were concentrated at the top. Vrunda
Bansode, partner at Sattva Consulting and the author of
the study, said the data showed that promising
homegrown NGOs needed support in the form of
unrestricted grants and capacity-building programmes to
help them grow as robust organizations.
VOLATILE FINANCES
Nonprofits strongly rely on foreign donations: for 46%
of the organizations, overseas sources made up more than
half of their donation income in these three years
(whenever data was available). Entities working on causes
such as sustainability, gender and healthcare were more
likely than others to rely on foreign funding.
However, the government’s crackdown on foreign
funding of NGOs has meant that domestic donations have
grown slightly faster in recent years. While foreign
donations for domestic NGOs grew 20% in 2021-22,
donations from domestic sources rose 24%. “Indian
domestic philanthropy has been growing and more new-
age givers are actively exploring the space, adding to
domestic donations,” Bansode noted.
The total pool of capital procured by the set of NGOs in
the study was somewhat stagnant over the three years
when adjusted for inflation, pointing to a greater and
urgent need for domestic funding to step up. At an
individual level, finances are volatile, with ups and downs.
This uncertainty makes scaling up tough: while not all
NGOs need to scale up, the ones that intend to for greater
impact need more reliable streams of funding.
NEWBIES SHINE
Most of India’s best-funded NGOs have sprung up in the
21st century, possibly due to improved CSR norms and
rising professionalization of the sector.
the top 50 in 2021-22, as many as
26 were incorporated in 2000 or after.
fundraise through multiple channels,
and maintain donor relations
professionally have become important
skills that can mean the difference
between the next grant or not,” Bansode
said. “Older nonprofits that did not evolve with the times
have plateaued.”
DELHI ON TOP
Delhi-headquartered NGOs shared 35% of the total
2021-22 income of the entities analysed. (The data
captures only the state of registration: a Delhi-based NGO
could well be operating across India.) Are less-developed
states missing out by not having enough large-budget
locally-headquartered NGOs? “It’s a chicken-and-egg
situation that can be resolved by funders taking a long-
term view and making strategic investments in first
developing the local NGO ecosystem in these areas before
they can deploy large amounts of impact capital capably,”
Bansode said. She called for uniform standards for
accounting, reporting and disclosures for NGOs that could
bring about much-needed clarity and trust for the
philanthropic ecosystem to flourish. On their part,
nonprofits need to be more and transparent about their
operations to build trust, Bansode added.

PEANUTS by Charles M. Schulz