The coronavirus and resulting economic crisis could permanently change credit union philanthropy, not just in terms of total dollars raised but also how charitable funds are collected.
Philanthropy has long been a key component of the movement’s DNA, and many advocates frequently tout the industry’s charitable giving as proof of its “people helping people” philosophy. But the coronavirus is likely to put new pressures on how credit unions and members give, though it may be impossible to gather concrete data on how dramatic the changes are.
Part of the challenge lies with tracking donations — or, more specifically, a lack of tracking. While some partners, such as Children’s Miracle Network Hospitals, annually track industry giving, credit unions are not subject to the Community Reinvestment Act and not otherwise required to log their donations. As a result, no industrywide data on philanthropic trends exists.
Global Credit Union in Spokane, Wash., began participating in the city’s Walk MS in 2013 to help support multiple sclerosis research, with events taking place not just in its hometown but also at its three branches on U.S. military bases in Italy. This year, however, the pandemic, social distancing and limited branch access made the event more challenging. Management shifted its focus to raising donations online and spreading awareness through social media, but much of the event’s success has historically relied upon talking with members inside branches and raising donations that way.
This year’s collection totaled about $2,600, which Corporate Communications Manager Janet Durnford said is “probably three-quarters of what we normally raise. We were hoping we’d be able to match what we normally raise, but it was better than the feeling at the beginning when we thought, ‘Oh my goodness, no one’s going to want to be involved in this.’”
While Walk MS wasn’t as successful as in past years, Durnford and others at the $469 million-asset Global are now examining how the credit union can continue its philanthropic push throughout the rest of the year, particularly in an environment where large-scale public events may be out of the question. Global has pivoted to more of a virtual presence, promoting philanthropic opportunities and working to provide members and the community at large with a variety of ways to donate directly to causes the credit union supports.
Marian Z. Stern, principal at the consultancy Projects in Philanthropy, suggested the coronavirus could reframe the wider philanthropic world, at least for the short term.
“If you look at statistics from the last recession or 9/11 or Hurricane Katrina or Superstorm Sandy … people will immediately convert most of their giving to relief from that disaster,” she said. “Organizations not directly involved with that disaster … would lose donations to food banks and places like that, but studies have shown that’s the initial knee-jerk reaction.”
The good news for many charities that receive support from credit unions, she added, is that if past patterns follow, “loyal donors will stay with many organizations” and regular giving could resume once the immediate crisis is over.
It remains to be seen how giving inside the industry will be impacted, including contributions to the National Credit Union Foundation, as well as state- and institution-level foundations, which support charitable initiatives such as scholarships, grants for credit unions, financial education and other efforts. Some groups have begun
Can CUs make the jump to virtual giving?
Just as individual credit union giving may see a decline, the industry’s charity of choice is also expecting a drop in funds.
Credit unions as an industry have raised roughly $200 million for Children’s Miracle Network Hospitals in the last 24 years through the CU4Kids program, and total giving for 2019 was up 11% from the year before, to $13.6 million, according to Nick Coleman, CMN’s director of strategic partnerships. That figure is expected to drop this year, though Coleman said the organization does not yet know how much of a decline to expect.
Because credit unions and CMN hospitals are so closely intertwined, it’s unclear whether CMN hospitals will be disproportionately impacted by any decrease in giving or if they might be insulated while other charities see their donations from credit unions dip.
“I think it’s a bit of both,” said Coleman. “We’re insulated in the sense that we have been a chartable partner to the industry for a long time, which has allowed us to still showcase the importance of fundraising for the industry.”
Toronto-Dominion Bank plans to give most employees the option to return to the office this month and is aiming for workers to officially transition to their new working models by June.
The Biden administration once again extended the pause on student loan payments enacted to help borrowers during the COVID-19 pandemic, this time through the end of August.
Employees will still have some flexibility to work from home, but are strongly encouraged to collaborate with colleagues in person, according to people familiar with the matter.
Other, more informal charitable efforts could also see a drop. The industry’s traditionally robust conference schedule — including national and state-level meetings, as well as vendor-specific shows — has
One factor that may cut into total donations is that much of the movement’s fundraising is done in small, spontaneous donations, such as members donating $1 at the branch to buy a paper balloon, with the funds going toward CMN. Coleman said about $5 million of the group’s total fundraising for 2019 came from those kinds of donations.
Global CU’s Durnford suggested that type of giving was also likely to decline with branch access limited and social distancing measures in place. With most employees home, credit unions can’t do fundraisers, such as allowing staff to wear jeans on Fridays in exchange for a $5 donation to a particular charity. Global has also hosted staff potlucks as part of its philanthropic efforts, but those are on hold now, as well.
“My best tools, jeans and food, have been taken away from me,” quipped Durnford.
In order to make up for a potential decrease in smaller donations, CU4Kids is currently in the process of launching Give on the Go, a fundraising solution that can tie in with credit unions’ existing mobile and online banking platforms. The tool has been in the works for a few years, and CMN's Coleman said that while credit unions understand that consumers have migrated to those channels, “fundraising hasn’t quite followed that.”
“Credit unions know engaging members in giving is important and helps build affinity with them, but we need to catch up to where technology currently is,” Coleman added.
Stern said one effect of the pandemic could be a greater push toward virtual giving, not just from credit unions but across the philanthropic space.
“Different crises were watershed events for philanthropy,” she said. The 2010 Haiti earthquake “was what made text-to-donate a thing; people were doing that before, but not a lot…I think this pandemic is going to do the same thing for making virtual and online giving huge, if not the majority of giving.”
