Falling donations, increased demand and rising operational costs are putting serious financial pressure on charities. In addition, obtaining public funding remains a significant challenge with competition for grants intense.

We’ve seen charities demonstrate remarkable resilience in the face of challenges in the past, with many repurposing to satisfy the changing dynamics of need within society. Charities have also shown creativity in seeking to generate income from different sources.

There are many great strategies for generating income already being used by charities that we work with. Here are some to consider if you’re exploring your options.

Corporate partnerships

Corporate giving, as one-off gifts or even better as ongoing relationships can provide an invaluable income boost.

To create a successful partnership with a business, charities need to think like a business. Approach potential partners with a clear plan and great pitch, emphasising what impact can be achieved if they invest.

As with any relationship, having shared values is really important. We have seen some partnerships last decades, as both parties have similar values, activities and priorities. Perhaps the business works in the same sector, has a similar customer demographic, or simply believes in your cause, find a business with a meaningful connection.

Smaller charities would benefit from embracing existing ties and local connections. This might mean focusing on people they’ve traded with before or local organisations whose customers will recognise their name. Whatever the size of the business, charities should look for a natural opportunity for collaboration, so the relationship makes sense to donors and aligns with the charity’s mission.

Repayable or blended finance

Traditional lending, from banks such as CAF Bank, or unsecured repayable finance, from the likes of CAF Venturesome, can help fund diverse situations including growth capital to build core operations, pay off debts, launch a new project or help out during a cashflow problem.

You may even benefit from Venturesome’s standby facilities, which can be secured in advance and used at a later date for peace of mind – or blended finance, a financing package made up of a loan and a grant that can be more affordable for small charities.

Find out more about where to start with repayable charity finance with our Charity Basics explainer videos.

Private donors

Private donors can also be a lifeline for charities. These days, they’re less about writing big cheques at fundraising events and more about investing in exciting opportunities to make a real difference.

Private donors want to understand how their funds make a difference to an organisation and its cause or beneficiaries. A healthy multiplier effect or a greater ‘bang for their buck’ is attractive. For example, using their funding to generate additional income from other donors, improving a charity’s long-term resilience or core capabilities, even developing better impact reporting through stories and data. Establishing and nurturing these relationships take time but is well worth it in the long run.

Social enterprise

A charity running its own business not only creates a stream of revenue that’s within its control, it can also help the charity’s mission. They generate their income through trading, but reinvest profits to fund their activities. Offering products and services (rather than just asking for donations) increases awareness and creates a two-way relationship that's based on more than giving money.

Social enterprise projects such as collaborative workspaces, cafés and shops aren’t just sources of funding. They can also provide work or volunteering experience for service users, and a point of access for people new to the charity.

Offering training courses is a popular commercial approach. You can use your knowledge to raise funds and spread the word about your charitable activities at the same time. For example, organisations like St John Ambulance and the Red Cross run first aid courses so businesses can get their first aiders trained.

Running a business can also help charities to get more in tune with potential corporate sponsors, as they’ll be facing some of the same challenges and may have business relationships in common.



If you’re looking for new funding sources, read our five things to consider when diversifying income.