Crowdfunding is a new concept that is useful for all businesses and startups. It began as a fad in Western economies and is now widely used by many startups.
In India, crowdfunding has become increasingly popular across various industries, including those dealing with medical costs and social effects.
It is still a fairly young occurrence, though.
Crowdfunding has already been successful for several Indian business owners. It has empowered them to create social impact initiatives and test their ideas/products in the market without a final MVP.
In this article, I will share the Best online crowdfunding platforms in India.
Before proceeding further, let’s get to know what crowdfunding is.
- What is Crowdfunding?
- What are the Best Crowdfunding Platforms in India?
- How to Create Your Crowdfunding Campaign Effectively?
- Pros and Cons of Crowdfunding Platforms
- How Does it Work if the Target Crowdfunding Money is Not Achieved?
- Are There Any Crowdfunding Scams? If Yes, How to Avoid Them?
What is Crowdfunding?
Crowdfunding is the technique of supporting a project or business venture by soliciting contributions from different individuals online. Crowdfunding is a type of alternative finance source. It has been estimated that more than thirties of USD billion was raised through crowdfunding globally in 2019 and is expected to triple by 2025.
All crowdfunding websites focus on a specific market niche. Equity, debt, and reward-based crowdfunding are some of these. The majority of crowdfunding in India is for charitable causes.
Before launching a crowdfunding project on one of these platforms, business owners must know the policies. Making an early prototype is another fantastic benefit of crowdsourcing. Crowdfunding is a popular tool business owners use to obtain an early release of a good or service. Investors might build a network around the service or product by providing benefits and rewards.
What are the Best Crowdfunding Platforms in India?
Crowdfunding Platform in India assists startups in raising money, social entrepreneurs in bringing about social change, and inventors in launching new concepts. Most people, small businesses, and startups steer clear of complicated fund-raising strategies. Complicated processes involve raising money through bank loans, angel investors, and venture capital.
Additionally, companies must consider the various funding stages before obtaining money to choose the best method. A much simpler and less complicated model is crowdfunding.
But finding people who would be motivated to invest in your idea or business is difficult, though. It is the main factor preventing many businesses from using crowdfunding sources.
As many crowdfunding websites exist, you need to discover the right people or platforms that will aid your startup by providing you with adequate funding. In this post, we’ll discuss a few of these crowdfunding platforms in India that help entrepreneurs or startups get money to boost their businesses:
One of the earliest crowdfunding platforms in India is called Kickstarter. The platform is well renowned for its artistic endeavors. Campaigns for movies, research, innovation, and books are just a few of the categories that are frequently featured on this platform.
Kickstarter sponsors many projects, from wearable health technology for the social effect to Edible Cutlery and photographic series on Indian deities. Additionally, numerous awards for various sorts of donations are anticipated from the campaigners.
Some successful Kickstarter efforts include The Sweet Requiem campaign, which raised $ 33,889 from 296 Backers and told the tale of a Tibetan lady living in India and her harrowing journey from Tibet.
Over 9000 people contributed $278,874 to a project named Edible Cutlery: The Future of Eco-Friendly Utensils, another successful initiative.
The platform’s focus topics include merchandising and inventiveness. Giving life to creative projects is the main goal or mission of Kickstarters.
GoFundMe, a fundraiser platform, is used by millions of people to support causes close to their hearts. Donors can select the campaigns they want to support on the website, and the site will then direct funds through payment processors.
Most donations go to the designated beneficiary, and the campaign organizer gets a commission. No matter where the donations come from, GoFundMe doesn’t charge a fee to start a fundraiser.
To launch a campaign, you must register on GoFundMe with your email address or Facebook account. After registering, you must build up a campaign, decide how much money you want to raise, and include relevant media.
Additionally, once your campaign is set up, you may start promoting it on social media or through personal connections. Donors can select your campaign and give any amount once you have amassed enough funds. The Trust & Safety team at GoFundMe ensures that campaigns and donations are accumulated securely.
Best part? All the donations make donors eligible to receive tax benefits under section 80G.
FuelADream is a rewards-based fundraising platform that offers campaigners the options of Keep What You Get (KWYG) and All Or Nothing (AON). According to its website, it is a platform that favors “quality over quantity.”
The veracity and sincerity of the campaigns posted on various crowdfunding platforms are a problem. To address this issue, FuelADream reduces the number of initiatives to a minimum. The most popular and well-supported campaigns are listed in a section titled “Crowd Favorite.”
The platform focuses on innovative concepts, causes, organizations, activities, and community-driven events. Additionally, their goal is to modernize and streamline traditional fundraising techniques.
All the donations made to the FuelADream platform are deductible. However, certain tax benefits eligibility criteria need to be met by the donor. You can check all grants of approval here.
Ketto is one of the well-known crowdfunding platforms in India with a broad focus. The platform includes initiatives for sports, women’s empowerment, animal welfare, children’s education, and personal campaigns. Ketto features sections like “Urgently Fund Required” and campaigns that can give contributors a “Tax Benefit” to make it beneficial for donors.
Among the campaigns supported on the website, one of them was the project for the Kerala Floods, called “Two Wheels of Hope,” which gave bicycles to schoolgirls.
The most effective way to raise money for both private and public purposes is through Milap.org. It has become one of the most prominent crowdfunding platforms in India. It mostly benefits those who live in rural and underprivileged areas of India who earn sub-$2 per hour or less. This website benefits social entrepreneurs, non-governmental organizations, and individual business owners.
Milap.org seeks to finance electricity, water, sanitation, education, and health projects through its micro-lending initiative. The portal has assisted many Indians in raising money, particularly for medical expenses, including pricey cancer treatments and other urgent medical needs.
The platform has so far closed over 50,000 large projects and raised $12.7 million with several lenders in over 120 countries. Indeed, they are making a lot of effort to ensure that the procedure for establishing firms in India is significantly faster.
The only drawback of donating money through the Milaap foundation is that they do not offer tax exemptions. It is because Milaap is not an NGO but only the fund custodian.
An Indian social venture called Donatekart enables people to provide needed items for a charitable purpose rather than donating pure cash. Sandeep Sharma and Anil Kumar Reddy launched the company in 2016. Donatekart is an internet platform for crowdsourcing that helps non-profit organizations develop campaigns and gather the products they need from contributors rather than typical monetary gifts.
The first platform of its kind in the world, Donatekart enables donors and philanthropic individuals to directly donate necessary goods to non-profit organizations online instead of money.
During the 2018 Kerala floods, Donatekart worked with T-Hub and Goonj to raise Rs. 20 million in relief supplies in just one week. Major news organizations in India covered this initiative.
By April 2019, Donatekart had collaborated with more than 600 organizations across India and had raised more than Rs. 6 crores in merchandise. More than 40,000 people have used the platform to donate to charity in various fields, including women’s empowerment, the elderly, medical care, education, animals, and disaster assistance.
Yes, all taxpayers can avail of the tax benefit of claiming 80G when they donate on this platform.
7. Impact Guru
Impact Guru is a platform for worldwide crowdfunding that relies on donations and provides options for NGOs, social companies, startups, and individuals. Maneka Gandhi, the Indian government’s Union Cabinet Minister for Women & Child Development, introduced it in September 2015.
Impact Guru raised 3.3 crores (US$410,000) in a seed round in April 2015 from Fundnel, a Southeast Asian private investment platform, and RB Investments, a venture capital firm based in Singapore. Impact Guru has raised 600 crores (US$75 million) since its founding to aid numerous charities and organizations.
Providing your PAN card details will help all taxpayers to get tax exemption under 80G on Impact Guru.
How to Create Your Crowdfunding Campaign Effectively?
Want to start building your campaign page? Why not? Its time to plan, strategize, and build a community of engaged fans ready to aid your noble cause. These 7 platforms mentioned above will help you and seamlessly allow you to accumulate money once you create and list your crowdfunding campaign on these reputed platforms. But how to make the most of it? Let’s show you the real picture:
· Captivate audiences with a compelling title and tagline supporting your campaign’s cause.
· Use attractive Campaign Card images,
· Create a video or Written Pitch for your Crowdfunding page that draws the immediate attention of everyone.
· Select a Crowdfunding Type, which may include Flexible Funding or Fixed Funding.
· Choose a reliable and trusted crowdfunding platform that will support your cause.
· Set a reasonable fundraising goal, deadline, and schedule.
· Create a promotional plan using Blogs and Forums, Social Media, Email Lists, Press, and Paid Advertising.
Yes, once you can raise desired funds for the cause, do not forget to deliver on your promises. You can ensure this by updating donors regularly on the campaigns’ progress.
Pros and Cons of Crowdfunding Platforms
1. A relatively new kind of funding is the collection of donations through crowdfunding websites. The adaptability of credit collection is a big benefit of these platforms.
2. Crowdfunding websites are a comparatively easy, affordable, and quick way to raise money for your venture or project.
3. Peer-to-peer finance is surrounded by less stringent laws and regulations due to its relatively recent existence.
4. Platforms for crowdsourcing are an affordable approach to executing an effective marketing campaign that draws both investors and customers. A successful campaign exhibits audacity, imagination, and entrepreneurship. Therefore, using such a campaign is considerably simpler than using a conventional technique for generating publicity.
5. Crowdfunding is a very good financing option for corporate social responsibility. A business concept or plan that emphasizes sustainability or makes investments in the community works well with borrowing public funds.
1. The fact that your project will be withdrawn from the site and you will have to start over if you don’t raise the funds you have targeted within time; is a significant drawback of using crowdfunding platforms.
2. There is a possibility that a borrower won’t be able to repay the loan when due or will be announced bankrupt. Less stringent regulations apply to peer-to-peer funding, resulting in fewer financial assurances.
3. Most crowdfunding donation collections happen online. Therefore, the internet and the caliber of the ICT infrastructure are crucial to platforms, lenders, and borrowers. Therefore, infrastructure and platform dysfunction issues can negatively impact the marketplace, investors, and entrepreneurs.
4. The legal process moves slowly. The current legal structure has not had enough time to adjust to these new circumstances because crowdfunding lately become a fully-fledged financing mechanism.
How Does it Work if the Target Crowdfunding Money is Not Achieved?
In case the desired crowdfunding money is not met, or the creator remains unable to accumulate enough (targetted) investors to pool in money for their noble cause, the creator is still authorized to keep all the pledged funds for their campaign. However, the creators need to pay a commission or fees on funds contributed by different investors.
If the project is canceled, all the investors get their money back!
Are There Any Crowdfunding Scams? If Yes, How to Avoid Them?
Besides so many advantages of crowdfunding, some risks are attached to this incredible idea. Unfortunately, scammers have penetrated the process of crowdfunding too. There are many rackets operated by fraudsters who launch fake crowdfunding campaigns in the name of poor & needy patients and loot innocents’ money.
It turns out that the amount the scammers raise is more than what is required. Additionally, it is also perceived that fake crowdfunding campaigns accept donations through pretenses and mislead people about the outcome.
Avoiding these deceiving crowdfunding campaigns or platforms is important to ensure your money is only used for charitable purposes. The best way to do this is by choosing reliable crowdfunding platforms. Yes, you can choose any platform we have listed in this guide. On all these platforms, you can be assured that your donated funds will be used for the right cause and that the campaign’s progress is transparently shared.
However, if you want to donate money besides these crowdfunding platforms, you must ensure that you do your check and confirm the authenticity of the cause of the donation.
Indeed, using Crowdfunding India to launch or grow your business is a terrific idea. You may complete the loan application procedure with a single click; yes, its that easy!
Additionally, crowdfunding is a successful business marketing strategy that will save you tons of money on advertising. It is due to the crowdfunding platforms‘ ability to expose you to a larger audience through social media websites like Facebook, Instagram and Twitter. Knowing how to leverage these platforms can maximize your funding.
However, conducting an extensive study on the subject before choosing crowdfunding websites to raise money is imperative. You can also consult a specialist or family members and friends who have already used these sites to acquire their opinions on the matter. It is because not all crowdfunding websites are secure.
So, what are you waiting for? Entrepreneurs and startups must select the best platform for them, given the abundance of possibilities and the opportunity to interact with like-minded individuals. There is a crowdfunding site for every specific business need that can be a perfect fit for them.