UK-based charity St Mungo’s has teamed up with social technology startup Alice in an effort to create better transparency with regard to donations made by the public by leveraging the Ethereum blockchain.
According to the Public Trust and Confidence Report released by the British government in 2016, the public's confidence in charities is at an all time low:
“Concerns about how charities spend their money are felt widely, not just by those whose trust has declined. More than half of the public agree that they know very little about how charities are run and managed and this, in turn, makes them question the decisions that charities make. Across the public as a whole, three-quarters agree that some fundraising methods make them feel uncomfortable and two-thirds agree that charities spend too much of their funds on salaries and administration.”
Alice is looking to remedy this problem by applying blockchain technology. The company believes that the blockchain’s inherent transparency and immutability provide the perfect base for clarity in the charity industry. Using Ethereum smart contracts the startup has created a hyper-transparent donation platform, which holds any donations made until the set outcome is achieved. That means that the funds are released only if the proposed plan works and is validated, which, in turn, provides instant accountability and transparency for the donor.
Alice is pioneering this platform with the homelessness charity St Mungo’s through an appeal called the London Street Impact. This appeal seeks to change the lives of 15 homeless people in London through intensive, personalized support. The program includes finding short and long-term homes as well as therapy.
Speaking of the appeal, Alice CEO Raphaël Mazet said: "The charity sector is currently going through a crisis of public trust. We want to address that by helping trailblazing organizations like St Mungo's, who are committed to transparency, to raise more funds for the amazing work they do. We're excited to be launching this first pilot with an appeal that will make a really positive difference to the lives of 15 people. We hope to scale the project to help many more people if it's successful.
St Mungo’s Executive director of fundraising, Rebecca Sycamore, asserted her support saying "people who have been sleeping rough for a long time often have complicated histories and issues they need help to tackle. This pilot gives us more flexibility than usual commissioned services do. This allows us to give these people the personalized support that we know will help them rebuild their lives away from the streets.”
To avoid the volatility associated with cryptocurrencies and to ease the process of making a donation, Alice is working in collaboration with Tramonex Labs and the Financial Conduct Authority (FCA) through its Fintech Sandbox program. Tramonex Labs allows for donations to be made in sterling pounds.
In addition to the FCA and Tramonex Labs, the project is also being supported by a grant from Nominet Trust as was revealed by St Mungo’s Rebecca Sycamore. “We're very pleased to help pilot this innovative funding platform, working with Alice and partners in Westminster and the Greater London Authority. The pilot is being delivered using grant funding from Nominet Trust's Social Tech Seed program."
Voicing their support, Nominet Trust Director, Vicki Hearn added:
"Alice has real potential to rebuild public trust in charities thanks to its innovative use of blockchain technology. Nominet Trust is proud to support Alice in piloting this platform, helping to lift people out of homelessness, and raising the bar for the transparency, accountability, and security of charitable giving."
If this pilot is successful, it opens up the opportunity for a better relationship between the public and the charity sector as well as ensuring greater transparency which will likely translate to more donations and more people helped.